[Senate Hearing 107-225]
[From the U.S. Government Publishing Office]
S. Hrg. 107-225
CONSERVATION
=======================================================================
HEARING
before the
COMMITTEE ON AGRICULTURE,
NUTRITION, AND FORESTRY
UNITED STATES SENATE
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
__________
FEBRUARY 28, and MARCH 1, 2001
__________
Printed for the use of the
Committee on Agriculture, Nutrition, and Forestry
Available via the World Wide Web: http://www.agriculture.senate.gov
77-881 U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON : 2002
____________________________________________________________________________
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpr.gov Phone: toll free (866) 512-1800; (202) 512�091800
Fax: (202) 512�092250 Mail: Stop SSOP, Washington, DC 20402�090001
COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
RICHARD G. LUGAR, Indiana, Chairman
JESSE HELMS, North Carolina TOM HARKIN, Iowa
THAD COCHRAN, Mississippi PATRICK J. LEAHY, Vermont
MITCH McCONNELL, Kentucky KENT CONRAD, North Dakota
PAT ROBERTS, Kansas THOMAS A. DASCHLE, South Dakota
PETER G. FITZGERALD, Illinois MAX BAUCUS, Montana
CRAIG THOMAS, Wyoming BLANCHE L. LINCOLN, Arkansas
WAYNE ALLARD, Colorado ZELL MILLER, Georgia
TIM HUTCHINSON, Arkansas DEBBIE A. STABENOW, Michigan
MICHEAL D. CRAPO, Idaho BEN NELSON, Nebraska
MARK DAYTON, Minnesota
Keith Luse, Staff Director
David L. Johnson, Chief Counsel
Robert E. Sturm, Chief Clerk
Mark Halverson, Staff Director for the Minority
(ii)
C O N T E N T S
----------
Page
Hearing(s):
Wednesday, February 28, 2001, Conservation....................... 01
Thursday, March 1, 2001, Conservation............................ 89
----------
Wednesday, February 28, 2001
STATEMENTS PRESENTED BY SENATORS
Lugar, Hon. Richard G., a U.S. Senator from Indiana, Chairman,
Committee on Agriculture, Nutrition, and Forestry.............. 01
Allard, Hon. Wayne, a U.S. Senator from Colorado................. 17
Dayton, Hon. Mark, a U.S. Senator from Minnesota................. 18
Fitzgerald, Hon. Peter G., a U.S. Senator from Illinois.......... 15
Harkin, Hon. Tom, a U.S. Senator from Iowa, Ranking Member,
Committee on Agriculture, Nutrition, and Forestry.............. 09
Leahy, Hon. Patrick, a U.S. Senator from Vermont................. 13
Miller, Hon. Zell, a U.S. Senator from Georgia................... 02
Roberts, Hon. Pat, a U.S. Senator from Kansas.................... 12
Thomas, Hon. Craig, a U.S. Senator from Wyoming.................. 03
Stabenow, Hon. Debbie, a U.S. Senator from Michigan.............. 15
----------
WITNESSES
Smith, Katherine, Director, Resource Economics Division, Economic
Research Service, U.S. Department of Agriculture, Washington,
DC............................................................. 03
Stephenson, Robert, Director, Conservation and Environmental
Program
Division, Farm Service Agency, U.S. Department of Agriculture,
Washington, DC................................................. 22
Weber, Thomas A., Deputy Chief for Programs, Natural Resource
Conservation Service, U.S. Department of Agriculture,
Washington, DC................................................. 20
Zinn, Jefferey A., Senior Analyst in Natural Resources Policy,
Congressional Research Service................................. 05
----------
APPENDIX
Prepared Statements:
Lugar, Hon. Richard G........................................ 34
Harkin, Hon. Tom............................................. 36
Stabenow, Hon. Debbie........................................ 38
Smith, Katherine............................................. 40
Stephenson, Robert........................................... 58
Weber, Thomas A.............................................. 51
Zinn, Jefferey A............................................. 44
Document(s) Submitted for the Record:
Hutchinson, Hon. Tim......................................... 84
Lincoln, Hon. Blanche L...................................... 87
----------
Thursday, March 1, 2001
STATEMENTS PRESENTED BY SENATORS
Harkin, Hon. Tom, a U.S. Senator from Iowa, Ranking Member,
Committee on Agriculture, Nutrition, and Forestry.............. 90
Nelson, Hon. Benjamin E., a U.S. Senator from Nebraska........... 136
Thomas, Hon. Craig, a U.S. Senator from Wyoming.................. 91
----------
WITNESSES
PANEL I
Cox, Craig, Executive Director, Soil and Water Conservation
Society, Ankeny, Iowa.......................................... 92
Hassell, John, Executive Director, Conservation Technology
Information
Center, W. Lafayette, Indiana.................................. 93
Johnson, Paul, Farmer, Decorah, Iowa............................. 98
Rudgers, Nathan, Commissioner, New York State Department of
Agriculture and Markets, National Association of State
Departments of Agriculture, Washington, DC..................... 96
PANEL II
Buis, Tom, Executive Director, National Farmers Union,
Washington, DC................................................. 114
Cohn, Gerald, Southeast Regional Director, American Farmland
Trust.......................................................... 118
Sparrowe, Rollin, D., President, Wildlife Management Institute,
Washington, DC................................................. 116
Specht, Dan, Sustainable Agriculture Coalition, Washington, DC... 111
Stallman, Bob, President, American Farm Bureau Federation,
Washington, DC................................................. 110
PANEL III
Faeth, Paul, Director, World Resources Insitute, Washington, DC.. 131
Stawick, David, President, Alliance for Agricultural
Conservation,
Washington, DC................................................. 128
----------
APPENDIX
Prepared Statements:
Harkin, Hon. Tom............................................. 142
Buis, Tom.................................................... 205
Cox, Craig................................................... 144
Cohn, Gerald................................................. 219
Faeth, Paul.................................................. 227
Hassell, John................................................ 156
Johnson, Paul W.............................................. 182
Rudgers, Nathan L............................................ 171
Sparrowe, Rollin D........................................... 209
Specht, Dan.................................................. 196
Stallman Bob................................................. 185
Stawick, David............................................... 222
Document(s) Submitted for the Record:
Miller, Hon. Zell............................................ 232
American Soybean Association................................. 245
Defenders of Wildlife Statement on the Conservtion Security
Act........................................................ 248
The Land Stewardship Letter.................................. 233
National Corn Growers Association............................ 244
Natural Resources Conservation Service Program Backlog....... 249
President of Wildlife Management Institute, Rollin D.
Sparrowe................................................... 237
Statement of the International Association of Fish and
Wildlife Agencies to the Senate Committee on Agriculture,
Nutrition, and Forestry
Regarding Farm Bill Conservation Programs by Max J.
Peterson................................................... 238
Statement of the National Association on Conservation
Districts on the Conservation Security Act................. 246
Sustainable Agriculture Coalition............................ 247
CONSERVATION
----------
WEDNESDAY, FEBRUARY 28, 2001
U.S. Senate,
Committee on Agriculture, Nutrition, and Forestry,
Washington, DC.
The committee met, pursuant to notice, at 9 a.m. in room
328, Russell Senate Building, Hon. Richard G. Lugar (Chairman
of the Committee) presiding.
Present: Senators Lugar, Miller, Thomas, Stabenow, Allard,
Crapo, Roberts, Harkin, Fitzgerald, Dayton, Leahy, Lincoln, and
McConnell.
OPENING STATEMENT OF HON. RICHARD G. LUGAR, A U.S. SENATOR FROM
INDIANA, CHAIRMAN, COMMITTEE ON
AGRICULTURE, NUTRITION, AND FORESTRY
The Chairman. Thank you for coming. This hearing of the
Senate Agriculture Committee is called to order.
Let me mention to the Member, Senator Miller, who is here
on time, we are hopeful at some point, perhaps in the next 45
minutes, of obtaining a quorum of the committee. That would be
11 Senators. At that time, I'll try to interrupt the
proceedings to gain consideration of the committee of our
budget, our subcommittee rosters, memorandum of understanding
between Senator Harkin and myself on the bipartisan conduct of
the committee and budget and a whole raft of other things.
This type of procedure is occurring in all committees who
are having meetings today or tomorrow, and so it's important
that we take action on that. But we will try to count heads,
and if we find 11 around the table. So I would ask staff,
Democratic and Republican, to alert their Senators, hopefully
to bring about their presence, if possible. It is not easy ever
to get a quorum this early in the day or in the session. But we
will need to have one so that we can move ahead.
At this point, I simply want to say, in my opening
statement this morning, that we have begun our work on the new
farm bill by receiving testimony from the Commission on the
21st Century Production Agriculture about its recommendations
on our legislation. Today our committee begins 2 days of
hearings on conservation, a very important part of our farm
bill and our Farm bill discussion. Conservation programs were
significantly expanded in the conservation title of the 1985
Farm bill. The establishment of the conservation reserve
program in the 1985 bill was due to recognition by many of us
in Congress of the need to address serious soil erosion
problems facing agriculture.
The 1990 and 1996 Farm bills further strengthened
agricultural conservation programs. This is one area of farm
bills where there has been strong bipartisan support in the
Congress.
In my view, there are at least three fundamental questions
to consider as we begin debate on the conservation title. First
of all, what should be the environmental goals of the next farm
bill? How should they be designed to attain those goals through
voluntary incentive based programs?
Second, what will be the cost and benefits to landowners
and producers of achieving those broad goals? Third, what will
be the cost and benefits to society of achieving those goals?
Hopefully the testimony presented at these 2 days of
hearings will help us answer these questions and perhaps others
that members will pose. One of the challenges facing
agriculture today is how to provide food, fiber and industrial
raw materials without jeopardizing the future productivity of
our natural resources. Private landowners are stewards of over
70 percent of our Nation's land. Our Nation's farmers and
ranchers are facing increasingly complex environmental problems
and regulations. Increasingly, taxpayers have been demanding
and expecting increased conservation achievements from farmers
and the agricultural sector.
Given this situation, we have still another request to
consider. Should there be a substantially larger investment by
the Federal Government in conservation cost share and incentive
programs?
As we try to answer these questions, it will be important
for our committee to hear about how the current conservation
programs are managed, the use and distribution of funding for
those programs, the types of agricultural producers and
landowners who participate in the geographic distribution of
those participants. We're also seeking suggestions for
improvements and changes to the current programs and asking
whether there is need for new initiatives. We'll be trying to
determine the appropriate role for the Federal Government in
assisting farmers, ranchers and other landowners in achieving
conservation goals.
Now, today we'll gather testimony from representatives of
the U.S. Department of Agriculture and the Congressional
Research Service about the administration and funding of our
current program. At tomorrow's hearings, witnesses will include
representatives of farm organizations, conservation and
wildlife groups, and State agencies. And we will seek the views
on current programs, as well as suggestions for improvements
and new approaches.
I welcome our witnesses today, and look forward to hearing
their testimony. Before I call upon them, let me ask first of
all if there are comments or statements from Senators who were
present at the initiation of this hearing. Senator Miller, do
you have an opening comment or statement?
[The prepared statement of Chairman Lugar can be found in
the appendix on page 34.]
STATEMENT OF HON. ZELL MILLER, A U.S. SENATOR
FROM GEORGIA
Senator Miller. I have an opening comment, but Mr.
Chairman, I'd just like to submit it for the record. I want to
hear as many of these witnesses as possible.
The Chairman. Thank you. It will be submitted into the
record and published in full in the record.
Senator Thomas.
STATEMENT OF HON. CRAIG THOMAS, A U.S. SENATOR
FROM WYOMING
Senator Thomas. Thank you, Mr. Chairman. I, too, will
submit it for the record. I just want to say that these
programs are especially important in Wyoming. I think, when you
look at the environment and those kinds of things, we have a
good relationship with NRCS and we look forward to continuing
that. But I agree with you, Mr. Chairman, that we've got to
look into it and see how we can make it work better and make it
a part of the Farm bill. So thank you for this.
The Chairman. Well, thank you very much, Senator Thomas.
Your statement will be a part of the record in full.
It's a privilege to have before us Ms. Katherine Smith,
Director of Resource Economics, U.S. Department of Agriculture
in Washington, DC.; Mr. Jeffrey Zinn, Specialist in Natural
Resources of the Congressional Research Services of Washington,
DC.
Let me ask that you try to summarize your testimony and
preferably within a 10 minute period of time each. We'll ask
you to testify completely, Ms. Smith and Mr. Zinn, and then
we'll have questions from the Committee. And as you've heard
the explanation, if suddenly I see the magic moment has arrived
in which we have a quorum of 11, I will ask you to suspend
temporarily your testimonies, so that we can go about that
business, and then we will proceed again.
Ms. Smith, would you give us your testimony?
STATEMENT OF KATHERINE R. SMITH, DIRECTOR, RESOURCE ECONOMICS
DIVISION, ECONOMIC RESEARCH SERVICE, U.S. DEPARTMENT OF
AGRICULTURE
Ms. Smith. Yes, thank you, Chairman Lugar.
The USDA's Economic Research Service makes economic
assessments of conservation program options, frequently in
collaboration with the agencies that implement those programs,
and occasionally as an independent third party evaluator.
My written testimony provides an overview of conservation
programs from that perspective, their costs, their benefits and
economic insights that we've gained from having evaluated their
performance over time. You'll be getting the details of the
current programs from other USDA witnesses this morning. In my
brief oral comments, I would like to emphasize three points.
First, the benefits of conservation and environmental programs
have been substantial. We don't even know the total value of
the benefits, because many of them are benefits that are not
valuated on the market, they're non-market benefits that are
difficult to evaluate. And yet we have accumulated quite a
total of those that we can evaluate in some way.
The sum of on and off site benefits of a 40 percent
reduction in crop land soil erosion over the last 15 years is
estimated to be valued at over $2 billion per year.
Conservation provisions have drastically slowed the rate of
conversion of wetlands to agricultural uses, thus preserving
the wildlife habitat benefits and the environmental restoration
benefits of between 2.5 and 4 million wetland acres since 1985.
Wildlife habitat improved by enrolling land in the
conservation reserve program is estimated to have provided over
$700 million per year in benefits from enhanced hunting and
wildlife viewing opportunities alone, without the other
wildlife enhancement benefits that have not been able to be
estimated in dollar terms. An acre of conservation reserve
program land in the great plains pulls .85 metric tons of
carbon out of the atmosphere each year. Depending on
international greenhouse gas negotiations, this carbon
sequestration service could be worth a substantial amount.
Now, my second point is that while some of these benefits
are self-sustaining, particularly those that arose from
education and technical assistance that informed producers
about the benefits they could obtain personally from adopting
practices, most of the benefits are transitory. Because in the
absence of public programs, producers would have little
economic incentive or perhaps limited economic capability to
maintain the actions that result in these big benefit numbers.
So preserving the gains means continuing some form of public
assistance in the conservation and environmental arena.
Third, we've learned from observing the performance of past
and present programs that certain program characteristics are
more likely to make the programs successful, especially in
assuring cost effectiveness of programs. One of those
characteristics is that they are coordinated not only with
other conservation and environmental programs and regulations,
but also with farm programs which can, if we're not careful,
work at cross purposes, or to complement. But it has to be kept
in mind that the coordination is an important thing to keep at
the forefront of planning new conservation programs.
Second is targeting, spatial targeting by region of the
country that warrants attention for whatever the environmental
goal is that your committee decides is the one or the ones that
deserve attention, and also possibly targeting by types of
producers that particularly need support in carrying out
conservation practices.
A third kind of lesson learned from the past is that
flexibility is a good thing. Giving producers the option to
decide how to achieve an environmental goal is more cost-
effective and more successful than telling them, you must do
this particular practice. Working in the flexibility makes it
easier to meet a goal.
And finally, some recent work that we've done in the
Economic Research Service suggests that there can be unintended
consequences to providing support for conservation practices if
that support encourages increased production, an increase in
the acres under production. If that happens, you may see a
reduction in adverse effects on the environment from the
initial land farmed that can be overtaken by the environmental
consequences of putting more land in production.
So these are some of the things mentioned in greater detail
in the written testimony and available in a new report,
AgriEnvironmental Policy at the Crossroads: Guidelines on a
Changing Landscape, of which we've brought about 50 copies and
would be happy to distribute. Thank you for the opportunity.
I'll be happy to take questions after Jeff Zinn.
[The prepared statement of Ms. Smith can be found in the
appendix on page 40.]
The Chairman. Well, thank you very much, Ms. Smith.
Let me just ask staff if you can attach some of those
copies. It might be well to distribute them to Senators as they
come to this hearing today, and members of the staff, so that
they will have them. Because that's an important report and we
thank you for bringing those copies for us.
Mr. Zinn.
STATEMENT OF JEFFREY A. ZINN, SENIOR ANALYST, NATURAL RESOURCES
POLICY, CONGRESSIONAL RESEARCH SERVICE
Mr. Zinn. Mr. Chairman, members of the Committee, good
morning and thank you for inviting me to testify today.
The Committee has asked other witnesses to offer
recommendations for change in conservation policies and
programs. CRS policy, as many of you know, does not allow me to
make or take positions on recommendations on the record.
My oral statement summarizes my written testimony, which
provides a context for consideration of these recommendations.
It reviews the evolution of the conversation efforts since 1985
and characterizes the conservation effort today. It also
discusses current programs and activities, and outlines some
recent changes in NRCS, the principal USDA conservation agency.
My statement concludes by identifying through several
questions issues that may arise as you debate future policy
options. Congress has greatly expanded the conservation mission
in the last three Farm bills to include numerous new topics and
new approaches. New topics include water quality, wildlife, air
quality and animal agriculture, among others. New approaches
include State technical committees, priority areas for some
programs, and the use of easements, among others.
The conservation mission now includes more than 30 distinct
programs and activities scattered throughout USDA, but
concentrated in the two agencies who will testify later, NRCS
and FSA, and depending on whether you're a lumper or a
splitter, I think you could list quite a few more programs and
activities if you wanted to.
Three of the programs and activities deserve special
mention, I believe. Conservation Technical Assistance is a core
activity that is critical to the success of almost all other
conservation programs and the largest activity in terms of
staff demands for conservation. The Conservation Reserve is the
largest program in terms of spending. It uses about half the
total conservation budget each year, in recent primarily to
make rental payments.
The Environmental Quality Incentives program is the main
cost sharing program and includes several policy innovations.
Many of the other conservation programs or smaller efforts
focus on a wide variety of topics.
The expansion of conservation can be viewed in budgetary
terms. Total spending grew from about $1 billion in 1985 to
$3.6 billion in 1998. USDA subdivides the spending among five
categories for analytical purposes. One of these categories,
rental and easement payments, has grown from a negligible
amount to about half the total, about $1.8 billion. In the
report that Kitty passed out, there's an excellent graph that
really shows how this change has worked.
The other four have all grown but at far more modest rates.
These changes mean that a significantly larger portion of
conservation funds are being paid directly to landowners to
provide conservation benefits, while a smaller portion is going
to the agencies at USDA who deliver the conservation effort.
The Congress has had to respond several times in recent years
to constraints at NRCS by enacting supplemental or emergency
legislation to provide needed technical assistance funding.
The expansion of conservation can also be viewed in
staffing terms. While the conservation mission has grown, total
staffing at NRCS has shrunk from more than 13,600 staff years
in 1985 to 11,600 staff years in 2000. Its larger mission has
meant that local staff who deliver conservation to producers
and landowners have many more clients and are often unable to
work with them one on one, which historically has been the
hallmark of their role in conservation.
Another important result is that far fewer resources are
devoted to monitoring and program evaluation, making it more
difficult to ascertain what the programs are actually
accomplishing. The need for more information has made the
Natural Resources Inventory an even more important tool for
understanding how land, water and other resources are affected
by the conservation effort. It provides data that are necessary
to determine how well the programs are working, especially in
the area of erosion control.
Questions about the future of lands in the CRP and other
land retirement and multi-year contract programs have become
more important as the end of some of these contracts starts to
approach. In the CRP, land can be offered to be re-enrolled,
but it is unclear how program benefits will be retained for the
other programs that have multi-year contracts.
Policies to deal with this future need appear to be
lacking, although some States are reportedly planning to step
in to ensure that some of these environmental or resource
benefits are retained. We're just starting to become aware of
what some of these efforts might be.
Let me conclude by listing several questions that may arise
as you debate policy options for the future. First, will the
next generation of conservation policy be driven primarily by
opportunities to do more for agriculture, or by pressures from
outside forces to alter current agricultural practices?
Second, are additional programs needed? Third, are there
opportunities for greater program consolidation or
coordination? Should any programs be eliminated? We seem to
find it much easier to add programs to the list than to
subtract them in the policy making process.
Can some programs be simplified administratively? Should
greater emphasis be given to measuring accomplishments and
ongoing performance? What is the appropriate balance between
programs for working lands and programs to retire land? And
finally, should the conservation mission be expanded or
readjusted to provide greater assistance to landowners?
Thank you for the opportunity to talk with you today, and I
look forward to answering any questions you may have. Thank
you.
[The prepared statement of Mr. Zinn can be found in the
appendix on page 44.]
The Chairman. Thank you very much, Mr. Zinn.
We'll commence a round of questioning, with Senators
limited to 5 minutes each on the first round. If there are
additional questions, we will attempt to proceed there.
Let me begin simply by indicating that in your testimony,
Mr. Zinn, you have gone through the history of the 1985, 1990
and 1996 Farm bills with the 1985 bill and the Conservation
Reserve Program the largest of these programs initiated, as you
pointed out correctly, created to help curb erosion. Ms. Smith
has pointed out that we've had significant success in this,
valued at $2 billion a year each year, I gather, as this has
proceeded.
But the debate in the committee then, and I suppose an
underlying factor now, was that this was also a way of cutting
back production, or productive acres. A good number of Senators
saw dual benefit. Even then, in 1985, prices that were
unsatisfactory likewise farmers and in some cases that were
retiring or elderly and wanted to retire, the Conservation
Reserve Program appeared to be a good way to park a good bit of
land.
In the 1990 Act, the committee having observed that there
were some lands that were environmentally challenged, but a lot
of lands that were perfectly good wheat, corn and soybean
fields in the program, adopted a scoring program as to how much
conservation benefit occurred. So the bidding then occurred on
the basis of the scores that were available. So that then led
to much more of a conservation emphasis. That appears to have
proceeded really, although the 1996 Act was involved, as you
pointed out, in expanding the program, most significantly the
EQIP, the farm land production program and the wildlife habitat
program.
We've had testimony about the tremendous values in each of
these situations. The EQIP program of course requires, as
you've pointed out, a lot of staff assistance. The cost sharing
situations are more complex than the bidding of acres in.
But the net effect of this has been remarkable. Year after
year, as we've had oversight hearings, no conservation program
of any sort or any other environmental program in America, has
had the cumulative effective, or for that matter, the annual
effect, of these programs that come right out of the Ag
Committee. So we celebrate that each time we take another look
at this.
What I would ask of both of you, however, is were we on the
right track, in your judgment, in 1990 in trying to zero in on
the fact that we have so many acres, so many dollars, and try
to get the most conservation effect for those dollars? Has the
point system or those criteria that we used worked? Is there a
degree of equity or correspondence between actual conservation
results and this bidding process? Do either of you have any
expert testimony or will you have on suggestions if we were to
revise the scoring system, or enhance it in various other
criteria as to how we should do that?
Ms. Smith. You give me an opportunity, Mr. Chairman, to
reinforce one of the lessons we learned, one of the points that
I made. That is about targeting. The scoring system, the EBI
scoring system, is an excellent way to target that land that
you do want to set aside in order to obtain specific
environmental benefits. It has worked quite well.
In terms of revamping it, really depends on whether you
want to stick with the same goals or change the weights
associated with those goals or add new ones. But the technique
has proved to work extremely well.
The Chairman. Do you have suggestions about different
goals? In other words, you sort of begged the question as to
what we want to do, and obviously we'll try and make up our
minds. But what would you recommend that we do, from your
perspective?
Ms. Smith. I don't think I'm in a position to make a
recommendation that reflects really the national priorities.
There are lots of different ways that you can collect that
information, by using States or localities to help determine
what those weights should be on each of the objectives, by
making the weights variable from year to year, rather than
fixed in that EBI formula.
The Chairman. What are our basic objectives? Obviously to
stop soil erosion, and you've cited that a good bit of that is
occurring, and thank goodness. We have some carbon
sequestration going on that is very helpful overall in our
environmental picture.
Ms. Smith.That is not currently an explicit goal.
The Chairman. It just happens to be one of these
byproducts. What else does the program hope to do? In other
words, are we enriching soils in some way? Are we doing other
things that enhance this general value?
Mr. Zinn. I'm going to comment also, but probably not
answer your question well at all. It seems to me there are
several questions to think about with the future of CRP,
without making specific recommendations. One is, is the size
appropriate? Is the total number of acres that we include in it
the approximate size we want to be working at in the future? I
think you'll be hearing proposals to increase the size.
A second point is that, do you want to have one program
that covers everything using the environmental benefits index
or whatever formula we use, or do you want to have some sub-
programs, as we have now, to deal with especially valuable
environmental areas, State cooperative programs and the like.
So that's a second consideration.
And then the final thing I would say is that the CRP, from
its history, focuses on erosion and cropland. One could ask
whether there should be some components in CRP that maybe don't
deal with cropland, maybe don't have the requirement of the
cropping history requirement, and that's something to consider
as well.
The Chairman. I thank both of you. We've been joined by the
distinguished Ranking Member, Senator Harkin, who has had a
long time interest in each of these areas, and has been a major
proponent of these hearings, as well as legislation. Tom, I
indicated before you and some others arrived that at the moment
we are able to get eleven of us here, I would like to break
into our dialogue to have the business meeting that we need to
have for adoption of the budget, the subcommittees and what
have you. But at this moment, we don't have eleven people here,
and I would like to recognize you for your statements and
questions of our witnesses.
STATEMENT OF HON. TOM HARKIN, A U.S. SENATOR FROM IOWA, RANKING
MEMBER, COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
Senator Harkin. Thank you very much, Mr. Chairman. I
apologize for being late. Wednesday mornings is when we have
our Iowa breakfast for Iowa constituents. We had a big load of
them this morning, so I apologize for being a little bit late.
Because this is, as you indicated, Mr. Chairman, a long-time
interest of mine, and of all of us, I'm sure, on this
committee.
We know we've accomplished some good things in the past,
the various and sundry conservation programs, some that date
back basically to the 1930s. They have done a good job. When I
look at the hills in Iowa and I see all the terraces that are
out there that date back to, oh, gosh, I suppose they started
back in the 1950s some time, 1960s, 1970s, 1980s. It's done a
lot to save our soil. The various things that we've done beyond
that, the CRP program, the EQIP program, the wetlands reserve,
all of these have done really good things in terms of stopping
soil runoff.
There have been a lot of questions, of course, in terms of
CRP. It has taken a lot of land out of production. Quite
frankly, in many areas, it's had some detrimental economic
impacts, in local areas. I'm sorry, I just caught the tail end
of the Chairman's remarks here, but I wonder if we shouldn't
now be looking at a new, sort of a new approach on conservation
that's not just soil runoff, but how do we get into the whole
new area of nutrients and nutrient runoff. How do we measure
that, how do we encourage the best kinds of practices so we
don't have this immense nutrient runoff that we have?
How do we deal with the new situations that we have, at
least in my part of the country and I think some down in your
area, too, with the large confinement operations, and what
that's doing to our environment? I think I'm right, I may be a
little bit off here, but I think we have about as many hogs in
Iowa today as we did when I was younger, 30 years ago. Thirty
years ago, we didn't have any problems.
So if we have the same amount of hogs today, why are we
having so many problems? Well, 30 years ago, every small farmer
had a few hogs. And the animal waste from that, you put on your
land. That's what we did. It was never called waste. We didn't
call it waste. That was something that was a valuable asset.
Because that was done, it was all spread out, we didn't
have a problem with nutrient runoff. But now with these large
confinements and stuff we've got all kinds of problems with
underground and water pollution, with holding facilities
breaking periodically, trying to spread this fertilizer in the
wintertime, when it gets run off into the streams. So we have
that new dynamic that we have to deal with out there.
Then, looking at the whole green payment and carbon
sequestration again, this is going to have to be an area we're
going to have to consider in the future, because of our
agreements with other countries. This is an area where I think,
again, we can look at how we can develop this for farmers to be
eligible for some kind of support for carbon sequestration.
So in my view, it's my little rambling discourse here, that
while we've had good programs that worked in the past, I don't
know that we have to abandon them, I think they're still
valuable. I think we need to build on them for a new system of
conservation. I think that's our challenge here on this
Committee, to try to find out just what are those new areas and
how do we address them.
I'll end on this note. I think most of our conservation in
the past, most, not all of it has been paying farmers to not
produce, some kind of land reduction. You take this out, you
put this aside, you do something that you don't produce on it,
and you get a payment. But most farmers I know do things that
enhance the environment on an annual basis in their production
practices. They use their labor, they use equipment, they even
may use some of their own money. But they don't get any help
for that, it's just out of pocket.
I'm wondering if now we shouldn't begin looking at some
kind of, in the new Farm bill perhaps, process whereby we can
on a voluntary basis get farmers to do certain conservation
practices in their production patterns. Not to cut down on
production, it may even enhance production. But then give them
the kind of support they need as they do produce.
We have, I think, in the next 20 years we're going to see a
change in agriculture where people are going to be just growing
corn for feed. They're going to be growing it for feed and for
proteins, for oils, for pharmaceuticals, a whole biotech
revolution is upon us. We're going to have soybean fields that
are some for soybean meal and some soybeans for lubricants,
some soybean fields for edible oils and you're going to have a
lot of different designer crops out there.
How do we start fashioning conservation programs to address
the new biotech revolution that is upon us? I think that is our
challenge. I don't have a specific question right now. But if
you just have any thoughts on those areas, I'd be delighted to
hear from you on that.
Mr. Zinn. I have a couple of comments I would like to make.
One is that historically, before 1985, I think the conservation
programs focused on erosion, and because they focused on
erosion, the programs were largely limited to dealing with
cropland issues. I think cropland production is about 20
percent of the value of all agricultural production.
As the mission has expanded to include other goals, other
kinds of lands, and land uses have become important to
conservation and to the conservation effort. I think we see the
programs maybe still largely as having a big focus on the
cropland side. There are pressures that I think you'll be
hearing about at tomorrow's hearing to expand the effort, to
give more attention to some of these other lands and resources
that go with this expanded mission.
A second comment is that the programs deal almost entirely
with individual farms. It seems to me that as we get into a
more encompassing framework for looking at conservation needs
and conservation issues, perhaps we should also look at ways to
reward or assist multiple farmers who want to do things in a
small area where the benefits of many of them getting together
is more than the benefits of each of them acting individually.
So I think this sort of scale at which we approach conservation
is also an important issue. Priority areas, start to get at
this, but there are some other directions one could go.
And finally, I think as you identified, there are lots of
new topics that are being put into the conservation mix. They
make solving the problems and designing programs much more
complicated. That suggests some challenges for the institutions
that do this that perhaps should get a little more recognition
than they have in the past.
Senator Harkin. I appreciate that. Again, as we design
these programs in the future, I mean, a lot of our payment
programs have changed and are continuing to change. Since there
is a societal benefit to good conservation practices, I think
we ought to look upon that in terms of not just a burden on the
individual producer, but something that we all ought to share
in. That's just my own feeling on that.
Thank you.
[The prepared statement of Senator Harkin can be found in
the appendix on page 36.]
The Chairman. Thank you very much, Senator Harkin. Did you
have a comment, Ms. Smith?
Ms. Smith. Yes, I do, thank you. The extremely expert and
helpful people sitting behind me gave me literally a long list
of different environmental benefits that can arise from
conservation and environmental programs. The big three are
soil, wildlife habitat and water quality. But there's air
quality, farm land preservation, water storage, navigation, it
goes on and on and on. So you've got this large list of
benefits.
As you mentioned, Senator, you also have differentiated
farming operations and site specificity on top of all that
heterogeneity. So you end up with all sorts of accommodations
and permutations of possible benefits, possible cost, possible
actions, on different kinds of operations. So it really
underscores the point that there isn't going to be a one-size-
fits-all.
Senator Harkin. I haven't seen the list, but I challenge
your thinkers sitting back there, is energy production listed
on that?
Ms. Smith. Yes.
Senator Harkin. Oh, well, you're way ahead of me.
[Laughter.]
Ms. Smith. Biomass.
Senator Harkin. Good for you. OK, that's fine.
The Chairman. The magic word. Thank you very much, Senator
Harkin.
I'm going to recognize the Senators in order of seniority,
and let me just sort of go down, so you'll have an idea of
about when your turn will come. Essentially, on the Republican
side, Senator Roberts, Senator Fitzgerald, Senator Thomas,
Senator Allard, Senator Crapo. I have only one alternative on
the Democratic side for the moment, you'll be joined, Debbie--
well, here, you've already been joined by Senator Leahy.
Very well. Senator Roberts.
STATEMENT OF HON. PAT ROBERTS, A U.S. SENATOR
FROM KANSAS
Senator Roberts. Thank you, Mr. Chairman. I want to thank
you for holding this hearing today, and I want to thank Senator
Harkin, who just received an award in San Antonio from the corn
folks and the soybean folks for his efforts in being a real
leader and thinking out of the box in regards to our
conservation efforts and how we can make them more
environmentally sound but still adhere to the basic thrust of
what we're all about. It was an award that was certainly well
deserved.
There are going to be many, many hearings in the always
very complex task of writing the next farm bill. But I don't
think we can underestimate the importance of conservation.
These programs have numerous soil and wind erosion, wildlife
and environmental benefits, as the Chairman has pointed out,
and the distinguished Vice Chairman or Ranking Member and the
witnesses.
I want to just raise a little flag of caution, a parochial
flag, a high plains flag that is always straight out because of
the wind. We have memories of the day of the Dust Bowl in the
dirty thirties. Basically it was because of this very terrible
event that Congress first got into this business. I applaud the
discussion in regards to the CRP program. I would point out
there are more acres in Kansas in the CRP program than any
other State.
It's been a very popular program, and as a result we've had
a lot of folks, I remember, during the 1996 Act, who thought
that they could have a similar program benefits. With the
budget dollars we have, the only concern I had at that
particular time was that we didn't want to rob Peter to pay
Paul, or to rob Peter to pay Pat, or Pat to pay Peter, or to
rob the high plains for other areas. We were very supportive of
some of the changes that were made from the standpoint of the
environment, but we had hoped for additional funding, as
opposed to taking away the original purpose of CRP, where we
still have the needs.
So I'm going to insist, Mr. Chairman, that these important
benefits maintain their very proper role in these programs, and
we certainly remember the important history of the programs. I
was a member of the House Agriculture Committee in 1984 when we
first started this. I think I'm listed as one of the co-authors
of the CRP program, along with then-Congressman Dan Glickman,
who became Secretary. Then we finally got it done in 1985.
Let me just point out that sometimes we have problems in
implementing what we're trying to achieve with many varied
benefits. When we changed the EBI, the EBI index or criteria,
all of a sudden we had farmers whose contracts were in jeopardy
because of the red fox, I can't remember what little small fox
we were trying to protect, and the burrowing beetle. We looked
and looked and looked, and it wasn't so much that we had cited
these species that should have been protected, that are
protected, we couldn't find any.
But there was a holdup in regards to contracts and payment.
I remember we got into quite a meaningful dialogue with
Secretary Glickman. He presented me, Mr. Chairman, a box with a
burrowing beetle in it during the debate.
I just think we ought to remember that soil is the greatest
non-toxic pollutant we have in agriculture, and we still have
those primary functions that I think we must address. Let me
say that I appreciate the statement by the witnesses. I had
some questions for them, but obviously that should come later.
Except for the compliance provisions in the statement by
Ms. Smith, and I thank you for an excellent statement, and you
mentioned highly erodible land, or what we affectionately call
land from hell out in western Kansas. We had a lot of
requirements. We almost had a revolt out there, until we got
the head of then the SES to come out and take a look at normal
cropping practices, at what we're trying to do to actually save
the land.
So it's the implementation of some of these things that I
think are very important. That's why I think I'm so gratified
that Tom Harkin is really hitting up this, because obviously
we're all going to be aware of the best laid plans and then how
they actually affect our farmers and ranchers.
I think I've said enough, and I don't mean that to be any
kind of a warning flag. I just want to say that these are very
good programs. We ought to keep that base, and we ought to
again think out of the box, as the distinguished Senator from
Iowa has indicated, and I think we'll be headed in the right
direction.
And I thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Roberts.
Senator Leahy.
STATEMENT OF HON. PATRICK J. LEAHY, A U.S. SENATOR FROM VERMONT
Senator Leahy. Thank you, Mr. Chairman. Unfortunately,
we're doing two things at once, as so many of us do. Today
we're marking up the Bankruptcy bill in Judiciary and I'm going
there. But I wanted to, because of the agenda in Judiciary,
I've had to be absent from some of the first meetings of this
Committee. But I wanted to welcome the new members, Senators
Allard and Thomas and Hutchinson and Crapo, and on our side,
Zell Miller, Debbie Stabenow, Mark Dayton and Ben Nelson. I see
at least four of those new members here now.
I think, Mr. Chairman, you and I have been on this
committee for well over 20 years, but I think it wasn't since
1981 that we had these many new members. I was younger, you
were the same age.
[Laughter.]
Senator Leahy. But I look forward to working with you and
Senator Harkin on this. One of the things that we have done,
this committee is probably the most bipartisan or nonpartisan
committee in the Senate. We've been able to pass so much by
consensus. I hope we can get money in the budget resolution to
pass the farm bill this year, so that we don't get caught up in
election fever next year. But that's of course up to others.
I am working with a group of New England and Mid-Atlantic
States, they produce about 7 percent of the market value of
U.S. farm products, 7 percent, they get around 1 percent of
Federal agriculture payments. I think we should look at that
part of the country, where oftentimes we feel we get ignored
when there's a disaster bill, anything else, we're asked for
the tax money, we don't get the help, and we should look at
that.
But the most important thing is that we have something we
can all support, because it's hard enough sometimes to get a
farm bill through the other body. We have to show some very
strong support in the Senate to do that.
I also would like to see us work on mandatory funding for
the international school lunch program. Our former colleagues,
both senior members of this committee, Senator Dole and Senator
McGovern, have done so much on that. Of course, our own
nutrition programs here. I think we can look at things like
even global climate change. We look back 100 years from now,
people are going to say, what did we do for our farmers and
consumers there. Senator Roberts may be the only one who's
around 100 years from now, along with Senator Thurmond.
[Laughter.]
But for the rest of us, I want it to work. I hope that we
can avoid divisive regional fights on various subjects like
dairy.
[Laughter.]
If we can do that, Mr. Chairman, I know that you have been
nominated and rightly so in the past for Nobel Peace Prize. If
we can avoid any fighting over dairy, I'll be nominated for
one. Thank you.
Senator Roberts. Would the distinguished Chairman Emeritus
yield?
[Laughter.]
Senator Leahy. To the other former chairman from the House,
of course I would. Because we were part of the chairman caucus
who had a certain hairstyle criteria.
[Laughter.]
Senator Roberts. Let us just say that the antique furniture
in the House and Senate are served best by those with marble
tops.
[Laughter.]
We have another former chairman sitting to your left. But
the point I would like to make is that both Senator Allard and
Senator Crapo are battle-hardened veterans of the sometimes
powerful House Agriculture Committee, and have ridden with us
well on the infamous Ag posse. I know they're going to do a
great job. But I wanted to point that out to the Chairman
Emeritus. I thank you.
The Chairman. The Chair will intervene at this point before
the discussion deteriorates any further. Pat, please don't
leave for a moment, because we will have deterioration if you
leave.
Let me just say that in a moment, I'll move that the
Committee rules, the subcommittees and committee memberships
and the Committee budget be reported. Before I do so, I want to
point out my appreciation to Senator Harkin and his staff, who
have worked diligently with our staffs to try to have an
understanding of how our committee can best function during the
Congress. We have drafted, in fact, a memorandum of
understanding. I wanted to reassure all committee members, and
copies of that are there. I want to express public appreciation
to Senator Harkin for the spirit with which he has entered into
it, and all members.
Senator Harkin. Mr. Chairman, if I could just reciprocate
on that. I just want to publicly thank you. We had a very good
meeting going over these rules with our staffs, with you and me
and our staffs. We've worked all this out. I couldn't have
asked for a better relationship and better understanding
between us, given the division, even division that we have on
the committee and in the Senate. I want to publicly thank you
for your generosity and for your willingness to work together
in this great spirit. I just want you to know that I support
you wholeheartedly in your recommendations.
The Chairman. I appreciate that. I think this bodes well
for the work of our committee. As has been pointed out, we
don't really get much credit or time on the Floor unless we
come with a pretty good package by consensus. That may not
always be possible, but we shall try.
At this point, I move that we adopt the committee rules,
the subcommittee membership.
[Whereupon, the committee proceeded to a business meeting.]
[Whereupon, the committee returned to the legislative
hearing.]
Senator Fitzgerald.
STATEMENT OF HON. PETER G. FITZGERALD, A U.S. SENATOR FROM
ILLINOIS
Senator Fitzgerald. Thank you, Mr. Chairman, and I want to
congratulate you on holding these hearings. I generally have
been supportive of conservation programs.
I'm not going to have a full blown opening statement. I'll
just be interested to learn whether the USDA has done any
studies of which of the many conservation programs that the
Department offers are the most effective, I suppose both in
terms of helping our environment and I suppose one of the goals
of these programs is also to try and guard against
overproduction, too. Although maybe not explicitly, but I think
that's a side benefit of the conservation program.
So I'll be interested in hearing that, and I'm wondering
whether we've really ever done any studies to analyze which of
the many conservation programs give us the best bang for our
buck.
Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Fitzgerald.
At this juncture, I've received proxy statements from
Senator Cochran and Senator Hutchinson, and a statement from
Senator Hutchinson with regard to our hearing today, the first
with regard to the business we just conducted. I'll ask staff
to make these a part of the record.
[The Information referred to can be found in the appendix
on page 84.]
Senator Harkin.
Senator Harkin. Thank you, Mr. Chairman. I have Kent Conrad
and Senator Daschle and Senator Baucus also.
The Chairman. Very well, they will all be appropriately
reported in the proper places.
Senator Stabenow, it is your turn.
STATEMENT OF HON. DEBBIE STABENOW, A U.S. SENATOR FROM MICHIGAN
Senator Stabenow. Thank you, Mr. Chairman. To you and to
Senator Harkin, thank you for holding this hearing. This is a
very important topic, I think conservation is a very important
part of our agricultural policy. And also to Senator Harkin,
congratulations on your award, your much deserved award, as
well.
From my perspective, from Michigan, since 1987 we've had
over 278,000 acres that have enrolled in some kind of a
conservation program. I would certainly like to see that
increase. I have been very supportive, as a member of the House
Agriculture Committee, of the CRP program and other programs.
I've noticed that you specifically said it's not your role
to make recommendations to us. Although we would like, I think,
to hear recommendations specifically from you about ways to
expand or move in other directions. But I'm wondering, with the
CRP program, if you would be willing to talk about possible
other criteria. You've talked a little bit about it today, it's
been focused on soil erosion and cropland. What other kinds of
areas would seem to be logical extensions, based on what you
see in terms of the various demands and interests?
Mr. Zinn. I think that you're really asking two questions.
No. 1, is what goes on the list, and No. 2, is in the index,
how many points do you give for each of the things you decide
you want to put on the list. I think without getting specific,
it's important to think of the list as something that can
evolve over time, and probably should evolve over time as the
merits of relative issues change in the national policy
setting.
At some point it might be worth considering regional
variations, so that some regions of the country might have a
somewhat different list than other regions, because both the
agriculture is different and the problems are different. But
beyond that, I don't think I do want to get into specifics. I
suspect you'll have lots of people coming after us who do want
to get into specifics.
Senator Stabenow. Do you want to add to that?
Ms. Smith. I think Jeff answered it very, very well. There
are a range of things that the current EBI does not incorporate
that it could incorporate. Whether that needs to be done at a
national or regional or State level is an open question. Those
weights are all important, really. You can add many, many
things to the list and dissipate the effect on any one, or you
can just change the weights and change, as some may have
expressed some concern about, the principal objectives of the
program.
But certainly, carbon sequestration, energy, livestock
waste are things that appear to be eliciting greater concerns
now than a decade ago. So those might be considerations for
change.
Senator Stabenow. Absolutely. Well, thank you. We'll look
forward to the others that are coming forward with their
specific items that they would like to have us look at. I would
again compliment Senator Harkin for always thinking outside the
box and I am looking forward to a wide discussion, Mr.
Chairman, about the options before the committee.
[The prepared statement of Senator Stabenow be found in the
appendix on page 38.]
The Chairman. Thank you very much.
Senator Allard.
STATEMENT OF HON. WAYNE ALLARD, A U.S. SENATOR
FROM COLORADO
Senator Allard. Mr. Chairman, thank you. I am looking
forward to serving here on this committee as a new member.
The Chairman. It's great to have you.
Senator Allard. I served on the House Agriculture Committee
during the Freedom to farm bill deliberation, EQIP was under
the jurisdiction of the subcommittee which I chaired over
there. So I'm interested in that, and obviously interested in
conservation programs. We have a particularly unique State in
the fact that I like to refer to our State as two miles deep,
from the highest point of the State down to the lowest point.
So watershed gets to be an important issue. We have peaks over
14,000 feet and the lowest level of the State is somewhere
around 3,200 feet. We have a lot of plains area with dry land
crops.
So we have a rather diverse State. Conservation programs
are very important to the State of Colorado. I think we need to
continue to ask the question, how are our dollars are being
spent, are the programs effective and what not.
I have a question pertaining to the Small Watershed
Rehabilitation amendments of 2000. They became law with
considerable support from the Congress. I was just wondering
what has NRCS done to aggressively move forward on this Act, if
anything.
Mr. Zinn. I think the NRCS people will be coming after us,
and can give you some pretty specific answers on that.
Senator Allard. Can you comment on the EQIP program?
Mr. Zinn. Yes.
[Laughter.]
Senator Allard. Would you comment on the EQIP program, what
your perception is on it and what needs to be done, if
anything, to improve it?
Mr. Zinn. A couple of comments about EQIP. One is that the
use of priority areas has some real pluses for the environment,
I think, by focusing effort. But it's had some minuses in the
farm community for those people who don't come from priority
areas and have found it much harder to access funds that they
used to be able to get more easily through ACP. So that's one
issue that I think some people will raise, is whether this is
working the way it was intended and is providing greater
environmental benefits.
Another question, and one I raised in my testimony a little
bit, is what happens at the end of these multi-year contracts
that people who participate in EQIP get? Are they under any
obligation to maintain the facilities they built or the
practices they've installed with the money they've received? I
don't believe they are, although somebody from the Department
who knows the program better might offer some other insights on
that. To the degree there's no future requirement of any kind,
maybe some of those investments aren't going to be particularly
long-lived as landowners change their priorities about what
they're doing. I worry that perhaps policy should include
something that comes after the EQIP contract.
A third question about EQIP is whether the length of
contracts and the funding amounts are really the appropriate
sizes. Is that buying the kinds of things we want, or do we
need to make the potential for more money available to do
larger things?
A final point about EQIP is the animal agriculture, for
EQIP, as you know, the first conservation program that's
explicitly dealt with animal agriculture. As such, as you go on
to design the next farm bill, you should have some lessons that
have come out of EQIP that would help in policy formulation for
the next generation of conservation dealing specifically with
animal agriculture issues.
Those would be my four points.
Senator Allard. What about, there's a wildlife habitat
incentive program, WHIP. Can you comment about that a little
bit?
Mr. Zinn. I know very little about what that Program has
accomplished. I've heard lots of stories, anecdotes about good
things that have been done in various places. I don't know what
the sum of those stories is, and maybe somebody from the
Department could answer that better. The other thing about the
wildlife program I think is it may be one of those programs
that might be combined or more fully integrated with some of
the other conservation programs, because it is sort of small
and sitting out there by itself in the conservation context. I
think the wildlife people might take a different view of it,
however.
Senator Allard. I think there's just one small area in
Colorado that would be impacted by that. It's probably one that
the State will look at a little closer. So I am like you, we're
going to wait and see how this program moves forward.
I'd like to get back to the EQIP, but I guess my time's
out. I'm sorry, Mr. Chairman.
The Chairman. We'll come around again.
Senator Allard. Very good.
The Chairman. Senator Dayton?
Senator Dayton. Thank you, Mr. Chairman.
I'd be glad to yield some time if you want to follow up on
a question.
Senator Allard. No, I'll wait. Thank you.
STATEMENT OF HON. MARK DAYTON, A U.S. SENATOR
FROM MINNESOTA
Senator Dayton. I'm going to be brief, anyway, I have a
group of Minnesota farmers out waiting to meet with me. I'd say
leading into that that one of the relatively few programs on
which I think there's broad consensus and support among all
Minnesota farmers, as well as hunters and environmentalists,
are the value of the conservation programs. So I strongly
support them and look forward to finding out from these
witnesses and others how we can strengthen and improve them.
I was particularly interested in your response, Mr. Zinn,
to Senator Allard's question about the animal conservation,
because in Minnesota, we have a very, very serious and
widespread problem with the animal feed lot operations and
lagoons, and a lot of producers, large, medium and small, who
are really now under serious financial constraints and are also
wanting to be responsible stewards of their land, as well as
their neighbors and others who in some cases very desperately
want to see them make the necessary improvements.
So I'm really interested to see and explore, Mr. Chairman,
as we unfold these hearings and look at this, if there's a way
in which that kind of need can be incorporated into one of the
existing programs, or one of them can be expanded into
permitting that kind of activity to be undertaken. Thank you.
The Chairman. Thank you very much, Senator Dayton.
Senator Harkin?
Senator Harkin. I don't have any questions.
The Chairman. Senator Allard.
Senator Allard. Thank you, Mr. Chairman. Just briefly, on
the EQIP program. Basically you have the Environmental
Protection Agency implementing rules and regulations on feed
lots. Then you come in here and give kind of a supporting role,
help them comply with those requirements and regulations. Do
you feel like you're able to keep up with the requirements that
are being imposed on feed lots by the Environmental Protection
Agency with the support that you should be getting from EQIP?
Mr. Zinn. I think others from the Department can answer
that a lot more precisely than I can. But my impression, is
that more resources and more money in this particular instance
probably would make a fairly big difference. Also, because the
animal agriculture issue has largely emerged since the last
Farm bill was enacted, there is very limited policy that gives
animal agriculture a priority within the conservation programs.
As you and others are stating, it sounds like that's going
to get some serious rethinking. It probably will require some
tradeoffs in resources if more goes to animal agriculture and
there isn't more to spread around, then it will have to come
out of something else that was being done in the past. Those
are the kinds of questions that are arising at this point.
Senator Allard. Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Allard.
I just want to compliment you again, Ms. Smith, on this
remarkable publication you have distributed today, the
AgriEnvironmental Policy at the Crossroads. Particularly in the
opening parts which support your testimony and the charts
showing that soil erosion has been significantly reduced. These
are impressive figures now, aggregated from 1982 to 1997, at
least in one of your charts.
Even more dramatic, the change in the wetland picture, that
more wetlands have been restored than lost, so that the graph
that you have there, showing from 1954 to 1974 shows in fact a
loss, it looks to me like, of over 600,000 acres. Now these are
equated, and a very small chart showing a little in, a little
out, but in essence a net gain as opposed to a dramatic loss.
Finally, the lessons learned that you have evaluated there
are very helpful as we take a look not only at the achievements
but some of the problems that have been involved in that and
the challenges. So I commend this to all Senators and their
staffs and members of the general public, because that will
enhance our discussion with the facts.
Mr. Zinn, you have likewise, in behalf of your service, as
well as your own personal testimony, been very, very helpful.
So we thank you both and hope that you will continue to be
resources for us as we proceed through this chapter of the Farm
Bill.
Ms. Smith. Thank you, Mr. Chairman.
Mr. Zinn. Thank you.
Senator Harkin. I want to join the Chairman in thanking you
both for many years of service. We appreciate it very much.
The Chairman. It's a privilege to call now our second panel
of this hearing, Mr. Thomas Weber, the Deputy Chief for
Programs, National Resources Conservation Service of the USDA,
and Mr. Robert Stephenson, Director of Conservation and
Environmental Programs of the U.S. Department of Agriculture,
both coming from Washington, DC.
I'll ask you to testify in the order that I introduced you.
First of all Mr. Weber, then Mr. Stephenson. Your statements
will be made a part of the record in full. So I ask that you
summarize appropriately and hopefully within a 10 minute
period, then the Committee will commence questioning. Mr.
Weber.
STATEMENT OF THOMAS A. WEBER, DEPUTY CHIEF FOR
PROGRAMS, NATURAL RESOURCES CONSERVATION
SERVICE, U.S. DEPARTMENT OF AGRICULTURE,
WASHINGTON, DC
Mr. Weber. Thank you, Mr. Chairman, members of the
Committee. Thank you for the opportunity to be here today and
provide an update on the conservation programs that are
implemented by the Natural Resource Conservation Service. As
you know, farmers across America are faced with increasing
pressures to maintain a productive and profitable business. We
know that farmers want to be good stewards of the land, and our
mission is to help them to be good stewards with their
conservation challenges, and at the same time assure that they
remain productive.
The backlog of our program requests is a testament to the
commitment of the farmers and ranchers of this country to
conservation. Today I would like to highlight the many ways
that our conservation programs are making a difference and
describe the large demand and interest in these programs that
NRCS has serviced.
Our programs are voluntary. And they are to help farmers
and ranchers deal with regulatory pressures. The public benefit
from these programs has been so eloquently described today, the
societal benefits are an improved environment for all of us in
America, a point that I feel has not been adequately addressed
in this country. In short, I believe the conservation programs
that this committee included in the last Farm bill are win-win.
They're win-win for farmers, they're win-win for America.
But before I outline these programs, I want to say a word
about the cornerstone of everything that we do, that is, the
Conservation Technical Assistance Program. Everything we
accomplish is contingent upon the talents and skills of those
people that are out there in the countryside, in our field
staff, and the partners that we work with to help farmers and
ranchers. They're trained professionals with the technical
tools and skills and standards to get the job done. They're in
every community in this country and rural America. They're
there to help people. The partnership that we have with State
and local people, conservation districts, State conservation
agencies, Resource Conservation and Development councils and
others are just as important to helping get the conservation
done as part of what we do as well.
Having said this, I want to move on quickly to a review of
the 1996 Farm bill programs and highlight several of them.
First, the Wetland Reserve Program. It has been mentioned on a
number of occasions here today. It's meant to preserve, protect
and restore wetlands, where functions and values have been
depleted or diminished. It is making a substantial contribution
to the restoration of the migratory waterfowl habitat in this
country, and other habitat for birds and animals, including
endangered species.
The 1996 Act authorized a total of 975,000 acres in the
program. At the conclusion of fiscal year 2000, the program had
almost reached the maximum. However, this year's appropriation
provided an additional 100,000 acres, allowing the fiscal year
2001 acreage to increase to 140,000.
We have had five times as many acres offered voluntarily by
landowners to be enrolled in this program than what we can
provide funds for. It is clear that WRP continues to be a very
popular program with farmers and has extremely strong support
around the country.
Second, the Wildlife Habitat Incentives Program provides up
to 75 percent of the cost share for implementing wildlife
habitat practices. The program had an initial funding cap of
$50 million. As a result of the strong need for this program,
those funds were exhausted in fiscal year 1999, at which time
we had 1.4 million acres enrolled in over 8,600 long-term
contracts.
At the beginning of 2001, the former Secretary did decide
to utilize an additional $20 million for WHIP from funding that
was in Section 211(b), which was the Agricultural Risk
Protection Act of 2000, for WHIP. Again, our successes and
landowner interest indicates that WHIP is a program with very
strong support in the countryside.
The next program has to do with farmland protection, a
point of interest around this country in terms of development
and concern over conversion of agricultural land to other
purposes. It does provide cost sharing for development rights
and easements. There was $35 million available for it in the
initial 1996 Farm bill. At this point in time, all $35 million
has been utilized.
Again, the former Secretary in 2001 did decide to place $20
million from the Agricultural Risk Protection Act into the
Farmland Protection Program. We know that agricultural land
conversion is a growing concern, and we note that the amount of
land far overshadows the amount of money available.
I would speak quickly to the EQIP basically to say that we
have utilized all of the funds available for the EQIP program
in every year that funding has been available. It was
authorized for $200 million a year. In many years, we've had
$174 million for this program to address the resource needs.
And I would point out also in this program, each year we've had
three to six times the demand for the dollars that we have
available.
These programs have been extremely successful, and we
continue to receive many times the applications that we can
authorize to fund for these. That's good news.
Mr. Chairman, in closing, I would note that good
conservation doesn't just happen. It takes all of us, including
Congress, our conservation partners, and most importantly, the
people that are living on the land that make all of this
happen. We're proud of our accomplishments. We look forward to
working with you to build on all that we've done for the
future. This concludes my statement, Mr. Chairman, and thank
you again for the opportunity to appear.
[The prepared statement of Mr. Weber can be found in the
appendix on page 51.]
The Chairman. Thank you for that very strong statement. We
look forward to questioning you in a moment.
First, we'll call on Mr. Stephenson for his testimony.
STATEMENT OF ROBERT STEPHENSON, DIRECTOR,
CONSERVATION AND ENVIRONMENTAL PROGRAMS
DIVISION, FARM SERVICE AGENCY, U.S. DEPARTMENT OF AGRICULTURE,
WASHINGTON, DC
Mr. Stephenson. Good morning, Mr. Chairman and members of
the committee. I'm pleased to appear before you to discuss
conservation programs.
The Conservation Reserve Program, implemented by the Farm
Service Agency, is the Federal Government's single largest
environmental improvement program on private lands. Today the
CRP is safeguarding millions of acres of American topsoil from
erosion, improving air quality, increasing wildlife habitat and
protecting ground and surface water by reducing water runoff
and sedimentation. Countless lakes, rivers, ponds and streams
are cleaner, healthier and more useful because of the CRP.
The CRP's success, I believe, is accomplished through local
voluntary partnerships between individuals and Government.
Instead of compelling participation, the program uses financial
incentives to encourage farmers to voluntarily establish
valuable conservation practices, such as permanent covers of
grass and trees on land subject to erosion, where vegetation
can improve water quality or to provide food and habitat for
wildlife.
Initially, the CRP emphasized reducing soil erosion.
However, the public was becoming more sensitive to other
environmental issues, such as condition of streams, lakes and
rivers, and the need to preserve threatened wildlife species.
In the 1990 Farm bill, Congress broadened the program's focus
and today, CRP's objectives include improving water quality,
turning marginal pasture land into riparian areas, increasing
wildlife habitat and other environmental goals.
In 1993, total enrollment stood at 36.4 million acres,
which is today's maximum authorized level. Generally, farmers
bid competitively for CRP contracts, maximizing the power of
each dollar spent. Only the most environmentally sensitive
cropland is accepted, while less vulnerable farm land remains
in production. The result is an effort that targets the most
sensitive land and helps farmers while it keeps productive farm
land growing food and fiber at a competitive cost.
The CRP's benefits go far beyond environmental improvement.
By idling highly vulnerable and environmentally sensitive
cropland, the program has produced a wide range of economic
benefits. In an early study, the Economics Research Service
indicated that the economic benefits provided by the CRP total
an estimated $8 billion or more per year.
In October of 1997, FSA implemented the Conservation
Reserve Enhancement Program. That's a partnership between the
Federal Government and the States where CREP addresses
nationally significant environmental problems by targeting CRP
program resources. CREP is working to address water quality
problems in the Chesapeake Bay, restore salmon habitat in the
Pacific Northwest, protect New York City's water supply,
enhance water quality in Illinois and Minnesota, restore a
portion of the Great Lakes, improve wildlife habitat in
California and North Dakota, protect water supplies for 54
communities in Missouri and restore vital estuaries in North
Carolina.
For certain high priority conservation practices yielding
highly desirable environmental benefits, farmers and ranchers
may sign up at any time without waiting for an announced signup
period, provided certain eligibility requirements are met.
Continuous signup allows management flexibility in implementing
certain special conservation practices on cropland. These
practices are designed to achieve significant environmental
benefits, giving participants a chance to help protect and
enhance wildlife habitat, improve air quality and improve the
condition of America's waterways.
Through mid-January of this year, over 1.4 million acres
have been enrolled under continuous signup practices such as
filter strips, riparian buffers, contour grass strips and grass
waterways. The continuous signup effort has significantly
increased the enrollment of these environmentally important
practices. For example, enrollment of filter strips has
increased over 600 percent compared to the land enrolled prior
to the enactment of the 1996 Farm bill.
On April 13 of last year, USDA announced new financial
incentives totaling up to $350 million over a 3 year period for
producers participating in certain practices of the CRP
continuous signup. These new incentives included a signing
bonus of $10 per acre for every year of the contract, or $100
to $150 per acre. A payment equal to 40 percent of the
practice's installation cost, increases in maintenance create
incentives for practices involving tree planting, fencing or
water developments, and updated marginal pasture land rental
rates to better reflect the market value of those lands.
FSA also implements the Emergency Conservation Program,
which provides emergency cost share funding to agricultural
producers to rehabilitate farm land damaged by natural
disasters and for carrying out emergency water conservation
measures during periods of severe drought. The Pasture Recovery
Program, which provides payments to reestablish permanent
vegetative cover to owners and operators who suffered pasture
losses and the Debt for Nature Program for persons with FSA
loans secured by real estate who may qualify for cancellation
of a portion of their indebtedness in exchange for a
conservation contract with a term of 50, 30 or 10 years.
I appreciate the opportunity to testify today, and I'll be
happy to respond to your questions.
[The prepared statement of Mr. Stephenson can be found in
the appendix on page 58.]
The Chairman. Thank you very much. Let me start the
questioning, we'll have a 5 minute round for each of us, and
more if indicated. In your testimony, there's a table at the
end of it, Mr. Stephenson, you have Conservation Reserve
Program current enrollment level, which is a very useful chart,
indicating the number of contracts by State, the number of
acres in the CRP, and the average rental rate, presumably the
number of dollars per acre that were a part of that contract.
The differences between the States and the average rental
rates are substantial. There's a good explanation for that.
Would you give that? Give us some idea of the bidding process,
and why for example, in Iowa, let's take the distinguished
Ranking Member's State, the average rental rate is $97.86 an
acre. In another State where there are lots of acres, North
Dakota, for example, it looks to me like it's $33 an acre.
What would be the differential between an acre in Iowa and
an acre in North Dakota, given the fact there are many
contracts and many people involved in this?
Mr. Stephenson. We have tried to spend considerable
resources working with the FSA economists, the NRCS economists,
as well as in ERS, to approximate local prevailing rental
rates. That is a rental rate for agricultural dry land values.
We start the process by asking all of the local FSA and NRCS
employees and other USDA employees, such as extension service,
to sit down and tell us by soil type, NRCS maintains a data
base of soil types nationwide. They approximate those values
and our goal is to not affect the market, but to approximate
what a farmer would get if it was being cropped.
That's done for each soil type in the country. The farmer,
when he makes his offer or she makes her offer, the NRCS will
tell us the predominant soil types for that offer. We will take
the rental rates that have been established for each soil type
and we'll do a weighted average to come up with the maximum
amount that we're willing to pay for that acre.
The Chairman. So you then have some benchmarks, and after
this, why, in some States or some districts, this may pile in
with all sorts of offers, in that case presumably the final bid
is lower than your maximum, maybe substantially. Is that the
case?
Mr. Stephenson. In part of our evaluation of the offers, if
a farmer is willing to accept less than the maximum that we're
willing to pay, we give them additional credit, because we view
it as saving taxpayer money.
The Chairman. What do you mean by give them additional
credit?
Mr. Stephenson. In the environmental benefits index, we
consider six environmental factors plus the cost that the
taxpayers----
The Chairman. I see. So that would give him some more
points, along with the rest of the economic side of this thing.
It was very interesting.
In taking a look at this table, of course it covers the
whole country, but what is the current situation with regard to
CRP? There has not, as you pointed out, been an overall signup
in the fiscal year. But if we were to have another signup,
would you anticipate there would be a great many more bidders
than acres available in this program?
Mr. Stephenson [continuing.] I would expect, and I might
ask Mike Linsenbigler, who's here with me, but I would expect
that if we had a signup this year, which we are not scheduling
one, we would anticipate probably somewhere between 2 and 3
million acres being offered. I wouldn't be in a position to
estimate how many of those would be accepted, but we would have
about a million acres coming due this fall.
The Chairman. In the initial idea of CRP, the hope was that
many landowners would sign up for very long periods of time
because they were going to plant trees. It would not make sense
to plant the trees and cut them down after 5 years or some
intermediate period. What has been the experience of the
program with regard to those acres that are now in trees, and
therefore perhaps in a more permanent status of conservation?
Mr. Stephenson. Many of those acres have been re-offered
for signup, some of which we accepted. I'm not sure--do you
have any numbers, Mike?
Mr. Linsenbigler. Historically, the rural bank program,
about 95 percent of them plan to plant trees, remain in trees.
The Chairman. So the contract expires, the farmer would not
receive more money, but nevertheless received money for the
initial contract, planted the trees and has then a timber
stand, and as you say, in 95percent of cases, left the timber
stand, continued on as an asset for the property.
Mr. Stephenson. That's true, except that those acres that
were under CRP contract that were about to expire were eligible
to be re-offered.
The Chairman. So perhaps some of these timber stands are
re-offered and additional compensation was paid.
Mr. Stephenson. That's correct.
The Chairman. With the other programs that you've mentioned
that are less extensive than CRP, is there a similar bidding
process for those? How do people get into them and how much are
they paid?
Mr. Stephenson. Under the Emergency Conservation Program,
it's contingent upon some type of disaster condition, tornado,
hurricane, drought. Once a geographic area is approved, we will
make available cost share funding for approximately 64 percent
of the out of pocket costs of a producer.
The Chairman. Sixty-four percent?
Mr. Stephenson. That's correct. Under the Pasture Recovery
Program, that is really a very simple program. It's a cost
share program for seeding. Our cost share rate is 75 percent.
The Chairman. How about the wetlands programs? How do
people bid to get into that?
Mr. Stephenson. I need to defer to Mr. Weber.
Mr. Weber. Thank you, Mr. Chairman. The Wetland Reserve
Program, people would actually come forward with an offer to
have either a permanent easement, a 30 year easement or
actually full restoration of the land without an easement.
There are different cost shares for those, based on the value
of the land, or the cost of restoration. Those proposals would
come into the State technical committee, which is made up of
not only the NRCS that would chair it, but also the other
Federal agencies involved, made up of wildlife groups, other
interest groups in the State, agricultural groups.
They actually go through a process of evaluating those,
setting point values and ranking them in order. Then based on
the money available, they would go down that list in that order
and then make offers accordingly.
The Chairman. So you have a point system or some evaluation
also for the wetlands?
Mr. Weber. That is correct. That's essentially true in any
of our programs.
The Chairman. Of all the programs. Now, is information
about these programs widely available to producers throughout
America? I presume the answer is yes, but if so, how is it made
available? If you are a landowner, somewhere in America and
you're interested in any of these programs, how would you find
out if you were eligible or how do you go about the bidding
process?
Mr. Stephenson. I think probably both agencies maintain a
very rigorous public information program. Each of our agencies
have offices, most of them co-located throughout the country in
agricultural areas, where local people answer those questions
on a routine basis. In addition to that, we both have I think
probably fairly active web sites that get quite a lot of
activity where there's extensive information about all of our
programs.
The Chairman. I thank you for those responses. It's obvious
from the cumulative totals that you have mentioned that a great
deal of conservation good is occurring, likewise, substantial
income for many landowners in America. Both are of interest,
obviously, to this Committee.
Senator Harkin.
Senator Harkin. Thank you, Mr. Chairman. Thank you both for
excellent verbal and written testimonies here. Again, thank you
for your leadership in both the FSA and the NRCS.
Mr. Chairman, I think there is some really valuable
information here that's been delineated in a concise form, and
I appreciate that. The Chairman touched on those with the
tables.
Just a couple of things I'd like to hit on here. First was,
Mr. Stephenson, let me look on yours, at the farmable wetlands
pilot program that we just passed last year. We put the money
in the appropriations bill for it. As you point out, this
covers sort of the upper Midwest, I don't know how many States,
maybe six or seven States total. I've heard from farmers in
Iowa who are anxious to sign up in this. They've been waiting
and I just want to know, do you have any idea when we're going
to be able to start making these signups available, and making
these contracts?
Mr. Stephenson. We're very hopeful we're going to have
something available this spring. Immediately after the bill was
enacted, we had a group of field employees come in, and NRCS
also participated. We have drafted a rule for the Federal
Register, which is in clearance now, in the Department. We're
hoping that's going to move very quickly, and then this spring,
we'll be able to begin entering into contracts.
Senator Harkin. Spring out our way is what, April?
Mr. Stephenson. I've only been permitted to say this
spring.
[Laughter.]
Senator Harkin. All right. Well, please take back to the
Department the urgency of this. There's a lot of people, I'm
sure it's true in Minnesota, too, I'm sure they're waiting to
sign up there, and ready to go. This again could be a valuable
asset and help this year to many of our farmers, especially
some of our smaller farmers that have the less than five acres
that they could put away and get some help on that. So I hope
you'll move ahead on that aggressively.
Second, I've heard some concerns out our way about how well
the two departments, NRCS and FSA, are working together.
Basically, as we know, you do the technical work and you pay
the bills, basically. What I've heard is that in some cases,
well, I've heard from some of the FSA people, well, NRCS is not
getting the technical work out in time, I heard from the NRCS
people, well, FSA is not getting the paperwork done on time and
paying it on time.
So I don't want to say that this is something I hear
constantly, but I hear it enough to warrant my question to you
as to how you feel about the working relationships between your
two departments. Is there something that we ought to be looking
at here that might provide for a better delivery of these
services? I just ask for your comments on that.
Mr. Weber. Senator Harkin, I'll try to take a shot at that,
and Bob, I'm sure, has some thoughts. It's my personal view
these two agencies work extraordinarily well together,
considering the complexities of all the programs and the
interactions that take place, both from the technical side and
the financial side. I've worked with a group of professionals,
Bob here and his staff, and others, that I have a tremendous
respect for. I think we can do business together. Yes, there
are times that come up that individuals may not get along out
in the countryside. But I think we work through those
collectively and together, and we're able to do an excellent
job.
I think the agricultural producers that are benefiting from
the conservation out there and the payments that they're
getting from that process are being served well.
The Chairman. Mr. Stephenson, anything to add?
Mr. Stephenson. Two things come to mind. First off, we
have, I think in many cases, vigorous debates down at the
Department between us. I think by and large, we end up with a
better product. Sometimes we try not to be personal, but
sometimes it's certainly loud. But the end of that, I think,
generally has resulted in a better product.
As far as the situations where maybe one side of the Agency
is pitted against the other out in the field, I think we both
committed to each other a long time, for many years now, that
when those come up, we try to address those. If there's a
problem, we want to get to the bottom of it, because we can
burn a lot of resources. That's not our goal.
Senator Harkin. Well, again, I'm not trying to pick sides
here or anything like that. Like I said, it's not something
that I hear a lot of, but I hear about it. And it sort of
raised a question in my mind, Mr. Chairman, why, we've been
doing this this way for a long time and do we need to continue
to do it this way? In other words, since NRCS really has the
bulk of the work to do, they're the ones that go out and do the
bulk of the technical work and the help and that type of thing.
Why shouldn't they be the payers of the bills, too? Why
shouldn't they just run the financial end through NRCS, too?
I just ask that as an open question. Maybe there are some
reasons why, but I want to test that hypothesis. And I'd like
to test it as we move along this year in our programs. Maybe we
need to streamline it just a little bit more.
So I leave that out there, I don't need a response on that,
but I'd like to kind of look at it as we go along, why can't we
just do it through one agency, rather than involving two and
have FSA do some other things that maybe they should be
involved in. I just leave that out there for that. There maybe
some reasons that I am not looking at.
Mr. Stephenson, again, I don't know if I'm duplicating a
question here that the Chairman got into. I was trying to
listen carefully, and maybe you did respond. You talked about
this point system, but I'm trying to figure out, in designing
the incentive payments for the continuous signup practices,
that only some of them are eligible for these incentive
payments. I'm trying to figure out how you determine which
practices are eligible for the incentive payments and which are
not. I'm talking just about those incentive payments now.
Mr. Stephenson. On the incentive payments, they were born
out of a number of meetings that NRCS conducted out in the
countryside, a number of meetings that FSA conducted out in the
countryside. Then I believe there were some joint meetings
where farmers were basically asked, what are the impediments to
enrollment and what can we do to remove those. What we were
told by those groups is by and large, what resulted in the
incentive payment and the structure and the amounts that we
came up with. I think we were very responsive to what we were
told out in the countryside by the summation of all those
several meetings that occurred over a couple of year period.
Senator Harkin. In other words, it was based on NRCS's?
Mr. Stephenson. NRCS did a series of public meetings and
FSA did a series of public meetings, then I believe there were
some joint agency meetings too.
Senator Harkin. So out of that, that's how you determined
what practices would be available for the incentive payments?
Mr. Stephenson. Yes.
Senator Harkin. Do you get much feedback on that from your
customers out there? Have they been pretty satisfied?
Mr. Stephenson. As to the levels today? The major complaint
we're getting now, or that I've received anyway, and
essentially the only complaint, it has been because we did not
make them retroactive, has been the concern that's been raised
to me, about what the new levels were.
Senator Harkin. And I hope this may not, I ask this
question, but you may not need to answer it, maybe we need to
get other people from the Department up, some of the budget
people. But you pointed out, Mr. Weber, how much over-
subscribed these programs are. It's been my experience, too,
out in the field, that they're just way over-subscribed. I
think that doesn't really tell the whole story. They're over-
subscribed, but I think there's a lot of people that, they see
how long it takes, the odds are they're not going to get in, so
they don't even sign up anyway, they get discouraged from
coming in. I think that may be another added amount onto that
that's not reflected in the figures. EQIP you said was four-
times greater?
Mr. Weber. It varies from three to 6 times, depending on
the year.
Senator Harkin. Well, do you have a table, or do you have
something that would show us how over-subscribed each of the
programs are?
Mr. Weber. I have individual figures. I don't have it all
in a table. I could outline it very quickly for you, verbally,
if you wish.
Senator Harkin. Well, I don't know if I want to take the
time of the committee here. I'd kind of like to take a look at
it. Send it up, or something like that. What I'd like to see
is, what data do you have on what each, line up each one of
those programs and give me a little bit of history on the
subscription rate and how much they've been over-subscribed.
Then I'd like to know some figures on the funding, because I
want to see what would the funding level be required if we were
to meet 100 percent of the people that subscribed. That's what
I'm trying to get a handle on.
Maybe that's some place, you've got those figures handy. I
just could not get my hands on them the other day and I'd like
to take a look at them.
Mr. Chairman, thank you very much.
The Chairman. Thank you very much, Senator Harkin. In fact,
I think the question that Senator Harkin just asked would be of
really great interest to the whole committee, because clearly
as a part of our legislative work, we're going to try to
evaluate the demand for the programs. We are not at liberty as
a committee to determine all the monies, and we'll have to be
working with others on that. But it would be useful to know the
parameters, and that testimony, if you could give that to the
committee, as well as to the Ranking Member, it would be much
appreciated.
Mr. Weber. We'd be pleased to provide that.
[The information can be found in the appendix on page 56.]
The Chairman. Senator Allard.
Senator Allard. Mr. Chairman, I want to follow up on that
last question that I tried to ask the other panel. I felt like
you would be more in a position to answer that. It has to do
with the watershed program, to be more specific, the Small
Watershed Rehabilitation Program. I'd like to have you comment
on what's happening with that program.
Mr. Weber. Thank you, Senator Allard. The Small Watershed
Rehabilitation Amendments to the 2000 Public Law that was
passed and signed by the President in November authorized us to
work with sponsors of small watershed projects that come under
Public Law 556, Public Law 534 and Resource Conservation
Development Acts.
We have identified and we provided a report to Congress, I
think it's probably been a year or two back now, identifying in
a quick assessment, and I need to underline quick, that we have
at least 2,200 structures in this country, and I'm talking
dams, small dams, that are in need of significant renovation,
rehabilitation or breaching because of potential hazards to
life and property. The cost of that we had estimated from that
quick study was about $543 million.
This is a major issue in terms of public health and safety,
we believe. The legislation has been authorized; however, there
are funding issues that need to be dealt with of course by
Congress in that. At this point, there are no dollars funding
that effort. There are dollars for pilot rehabilitation
projects that were authorized under the Emergency Watershed
Program, the last supplement that came through, the last two
supplements actually, a total of $16 million.
Those States are Wisconsin, Ohio, Mississippi and New
Mexico that are now going through pilot efforts to road test
the process that we need to go through to actually rehabilitate
these structures. Those States continue to work through as
sponsors. We have roughly 15 dams we're looking at starting
this spring or summer to actually do construction to
rehabilitate.
So that's where we're actually doing some things out there
on the landscape under emergency legislation. However, under
the new legislation for rehabilitation there are no dollars at
this point.
Senator Allard. The sponsors of these are responsible for
operation and maintenance, do I have that right?
Mr. Weber. That is correct.
Senator Allard. Then the Federal Government is supposed to
come and provide cost share for rehabilitation. How do you
divide that responsibility up and how does that work?
Mr. Weber. The legislation prohibits expenditure of Federal
funds for operation and maintenance issues. Where operation and
maintenance has not been carried out in fulfilling the
responsibilities under the original project.
Senator Allard. Now, my question is, how do you draw the
line between maintenance and rehab?
Mr. Weber. Basically, a rehabilitation issue would be
things like where concrete has passed its useful life, let's
say 50 years. You have spoiling, you have cracking, you have
deterioration. That would not be a normal operation and
maintenance issue. You have metal pipe that corrodes and over
50 years, you would certainly in parts of this country have
major problems there for replacement. That's how we go out and
look at every one.
Senator Allard. Let me ask you about the size of the dam.
The Bureau of Reclamation has some responsibilities for dams.
I'm not exactly sure how far that goes. Is there some overlap
between what you're doing on the small watershed side with dam
safety and what-not, and what the Bureau of Reclamation may be
doing?
Mr. Weber. That's an excellent question. My answer is no,
because we do have, both organizations, including the Corps of
Engineers, have a clear distinction in terms of their
authorization. We work on watersheds that are less than 250,000
acres under our legislation, and the others work on the bigger
projects. So our dams tend to be much smaller. But we do have
roughly 10,000 of them around the country.
Senator Allard. Two hundred fifty thousand acres, that
probably limits you pretty much to flatter land areas? In
Colorado, they're larger because of our heavy slope and what-
not, I would guess in many of those areas it would go into the
Bureau, is that correct?
Mr. Weber. Probably, I would guess, and we would have the
data. Most of the projects in Colorado I believe are in eastern
Colorado.
Senator Allard. Or they could be maybe even real high in
the mountains, where there's not much drainage up above.
Mr. Weber. Right.
Senator Allard. OK. The States have passed dam safety laws
and what-not like that. We've had some high mountain reservoirs
which break in Colorado, cause a flood all the way down. Have
you gotten involved in any of those kinds of issues, high
reservoirs, perhaps a small drainage area that would qualify,
then there's a break or something? Have you been involved in
any of that?
Mr. Weber. Not to my knowledge in the high country. We have
had some other structures through flood events that we've had
damage to.
Senator Allard. In Colorado, we have a lot of, we have some
State laws passed on dam safety and everything. We have a
problem with some of these structures with developments
occurring below the structure, it raises the issue about dam
safety and what-not. How do you think the program is working in
coordination with States like Colorado that have dam safety
laws, that pass at the State level what you're trying to do at
the Federal level with these small watershed structures?
Mr. Weber. In the work we're doing out in the States, we're
working directly with the State dam safety officials. Georgia
is a great example. The State is putting in several million
dollars a year to upgrade these structures to the current
standards, which is another issue that we need to deal with.
Senator Allard. Who sets the standards?
Mr. Weber. Essentially the States.
Senator Allard. So they kind of drive your expenses?
Mr. Weber. Yes, they would have the criteria requirements.
But we work directly with them.
Senator Allard. Is there an advantage to the State to have
high standards so they drive more spending by the Federal
Government? Does that happen?
Mr. Weber. I don't believe so. I'm not that familiar with
each State's standards.
Senator Allard. Mr. Chairman, thank you.
The Chairman. Thank you very much, Senator Allard.
Gentlemen, we thank you very much for your testimony.
Senator Allard's questions brought forward again what you have
mentioned, and that is the programs of many of our States that
are significant. All of these programs work best where American
Federalism is the most vital, that is, the Federal Government
and the State governments, and on even some occasions, local
governments, because of particular situations.
I can recall just anecdotally from our own family
situation, my dad attempting to work with whoever was there in
the 1930s, 1940s, 1950s, and the programs we've talked about
today are truly remarkable as I reflect back on that time.
We've had wonderful hearings, I think Senator Harkin would
agree with me, testifying bit by bit over the course of the
last 15 years or so, of how America has been transformed.
We look at this, and we should, in the nitty-gritty of who
signs up and who gets paid and so forth. That is very important
in terms of equity, and we've got to try to work that out. But
the overall number of acres have transformed the interior of
many, many of our States. This is exciting to see. I can recall
the flood control, erosion control business in Indiana, even
when I was young enough to understand all this, in the 1940s,
really came down to just getting a bulldozer on your own and
using the vacation money to put more dirt on top of the levee
or to clear whatever had to be cleared. There really wasn't
much governmental impetus to this.
But if you planned to farm there for a good long while, you
had your own conservation ethic. It was your soil and your land
that was going to be affected.
More recently, when the CRP was founded, I had the
privilege of entertaining the Secretary of Agriculture, John
Bloch, out on the Lugar farm, to announce this thing, much to
the horror of Dave Stockman at the time, who was not aware that
it was going to cost so much.
[Laughter.]
The Chairman. But in any event, I've always seen Jack
Bloch, thanked him for coming, and for his own commitment.
Because USDA really was at the forefront of that, and an
advocate for these programs.
We appreciate again your testimony today. We look forward--
I would mention, for all members and staff, I convey that, our
hearing tomorrow will be in the Hart 216, the larger chamber.
It will be at 9 o'clock again, and we look forward to a large
number of witnesses who will come in from all over America to
comment on these programs.
Do you have any further comments, Senator Harkin?
Senator Harkin. No, Mr. Chairman, again I thank you for
your leadership in this area over the past. We really have made
some great progress in this country, thanks to your
departments, both of you, and the programs we've had out there.
As I said earlier, I don't mean to repeat myself, but I think
we now have to think about what's down the pike here. Again,
how we utilize the great program that Senator Lugar started,
the CRP program, that, we have some test programs going now to
use the biomass off that for energy.
But still, it's still CRP, it's not erodible, you're not
plowing anything up, you're planting grasses on that. There's
also carbon sequestration that takes place there. Perhaps we
can utilize some of that for other purposes other than just
sitting there. It's still wildlife cover and everything. So I
think we're thinking about ways of enhancing some more farm
income while not stepping back from our commitment.
Thank you, Mr. Chairman.
The Chairman. The hearing is adjourned.
[Whereupon, at 11 a.m., the committee was adjourned, to
reconvene at the call of the Chair.]
=======================================================================
A P P E N D I X
February 28, 2001
=======================================================================
[GRAPHIC] [TIFF OMITTED] T4345.001
[GRAPHIC] [TIFF OMITTED] T4345.002
[GRAPHIC] [TIFF OMITTED] T4345.003
[GRAPHIC] [TIFF OMITTED] T4345.004
[GRAPHIC] [TIFF OMITTED] T4345.006
[GRAPHIC] [TIFF OMITTED] T4345.007
[GRAPHIC] [TIFF OMITTED] T4345.009
[GRAPHIC] [TIFF OMITTED] T4345.010
[GRAPHIC] [TIFF OMITTED] T4345.011
[GRAPHIC] [TIFF OMITTED] T4345.012
[GRAPHIC] [TIFF OMITTED] T4345.013
[GRAPHIC] [TIFF OMITTED] T4345.014
[GRAPHIC] [TIFF OMITTED] T4345.015
[GRAPHIC] [TIFF OMITTED] T4345.016
[GRAPHIC] [TIFF OMITTED] T4345.017
[GRAPHIC] [TIFF OMITTED] T4345.018
[GRAPHIC] [TIFF OMITTED] T4345.019
[GRAPHIC] [TIFF OMITTED] T4345.020
[GRAPHIC] [TIFF OMITTED] T4345.021
[GRAPHIC] [TIFF OMITTED] T4345.022
[GRAPHIC] [TIFF OMITTED] T4345.023
[GRAPHIC] [TIFF OMITTED] T4345.024
[GRAPHIC] [TIFF OMITTED] T4345.025
[GRAPHIC] [TIFF OMITTED] T4345.026
[GRAPHIC] [TIFF OMITTED] T4345.027
[GRAPHIC] [TIFF OMITTED] T4345.028
[GRAPHIC] [TIFF OMITTED] T4345.029
[GRAPHIC] [TIFF OMITTED] T4345.030
[GRAPHIC] [TIFF OMITTED] T4345.031
[GRAPHIC] [TIFF OMITTED] T4345.032
[GRAPHIC] [TIFF OMITTED] T4345.033
[GRAPHIC] [TIFF OMITTED] T4345.034
[GRAPHIC] [TIFF OMITTED] T4345.035
[GRAPHIC] [TIFF OMITTED] T4345.036
[GRAPHIC] [TIFF OMITTED] T4345.037
[GRAPHIC] [TIFF OMITTED] T4345.038
[GRAPHIC] [TIFF OMITTED] T4345.039
[GRAPHIC] [TIFF OMITTED] T4345.040
[GRAPHIC] [TIFF OMITTED] T4345.041
[GRAPHIC] [TIFF OMITTED] T4345.042
[GRAPHIC] [TIFF OMITTED] T4345.043
[GRAPHIC] [TIFF OMITTED] T4345.044
[GRAPHIC] [TIFF OMITTED] T4345.045
[GRAPHIC] [TIFF OMITTED] T4345.046
[GRAPHIC] [TIFF OMITTED] T4345.047
[GRAPHIC] [TIFF OMITTED] T4345.048
[GRAPHIC] [TIFF OMITTED] T4345.049
[GRAPHIC] [TIFF OMITTED] T4345.050
[GRAPHIC] [TIFF OMITTED] T4345.051
[GRAPHIC] [TIFF OMITTED] T4345.052
=======================================================================
DOCUMENTS SUBMITTED FOR THE RECORD
February 28, 2001
=======================================================================
[GRAPHIC] [TIFF OMITTED] T4345.005
[GRAPHIC] [TIFF OMITTED] T4345.008
CONSERVATION
----------
THURSDAY, MARCH 1, 2001
U.S. Senate,
Committee on Agriculture, Nutrition, and Forestry,
Washington, DC.
The committee met, pursuant to notice, at 9:02 a.m., in
room 216, Senate Hart Building, Hon. Richard G. Lugar (Chairman
of the Committee) presiding.
Present: Senators Lugar, Thomas, Nelson, and Harkin.
The Chairman. This hearing of the Senate Agriculture
Committee is called to order.
In our hearing yesterday we heard testimony from
representatives of the U.S. Department of Agriculture and the
Congressional Research Service and others about the
administration and funding of our current conservation
programs.
As the author of the Conservation Reserve Program in the
1985 Farm bill, I was heartened to hear about the significant
reduction in soil erosion that has been achieved because of
this program.
A recent report prepared by USDA's Economic Research
Service details the important environmental gains that have
resulted from USDA's conservation programs in general.
Another example cited was the Wetland Program. Through the
Wetlands Reserve Programs created as a part of the 1990 Farm
bill title, agriculture has become the single largest source of
the U.S. wetland restoration.
In my opening statement yesterday I stated that there are
at least three fundamental questions to consider as we begin
debate on the conservation title of the new Farm bill.
First of all, what should be the environmental goals of the
next farm bill designed to attain through voluntary incentive-
based programs and what will be the costs and benefits to the
landowners and producers of achieving these broad goals? What
will be the costs and benefits to society of achieving those
goals?
One of the challenges facing agriculture today is how to
provide food, fiber and industrial raw materials without
jeopardizing the future productivity of our natural resources.
Private landowners are the stewards of over 70 percent of our
Nation's land.
Our nation's farmers and ranchers are facing increasingly
complex environmental problems and regulations. Increasingly,
taxpayers have been demanding and expecting increased
conservation achievements from farmers and the agricultural
sector.
Given this situation, we have another question to consider.
Should there be a substantially larger investment by the
Federal Government in conservation cost share and incentive
programs? By seeking answers to these questions we will be
trying to determine the appropriate role for the Federal
Government in assisting farmers, ranchers and other landowners
in achieving conservation goals.
Today, our hearing witnesses will include representatives
of farm organizations, conservation and wildlife groups and
State agencies. We will seek views on current programs as well
as suggestions for improvements and new approaches.
I welcome our witnesses today. We look forward to their
individual testimony. Before I call upon the first panel, I
call upon our distinguished Ranking Member, Senator Harkin, for
his opening comments.
STATEMENT OF HON. TOM HARKIN, A U.S. SENATOR FROM IOWA, RANKING
MEMBER, COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
Senator Harkin. Mr. Chairman, thank you again for holding
today's hearing on Conservation and America's private
agricultural lands.
I first want to welcome my good friend, long-time friend
and fellow Iowan, Paul Johnson. As you know, he is the former
Chief of the Natural Resources Conservation Service and former
Director of the Iowa Department of Natural Resources and a
farmer from Decorah, Iowa. He has been a true friend of farmers
and a visionary conservationist in the mode of Aldo Leopold
himself. I appreciate his long leadership in this area.
I also want to welcome two other Iowans: Craig Cox, the
Executive Vice President of the Soil and Water Conservation
Society from Ankeny, and Dan Specht, a farmer from McGregor,
Iowa, who, like Paul Johnson has got a long history of hands-on
active involvement in conservation and with practical farmers
of Iowa trying to figure out how we can keep more family
farmers on the farm and keep them actively involved in our
conservation of our natural resources.
So I welcome them here. I know we will have a lot to learn
from them.
As we learned yesterday, our farmers and ranchers have made
great strides towards protecting natural resources. Their role
as conservationists of our lands for future generations is
every bit as important as the food and fiber they grow.
We need to provide them with the tools they need to succeed
and expand our tradition of promoting conservation on private
agricultural lands.
I commend our distinguished colleagues, Chairman Lugar and
Senator Leahy for their unwavering dedication to conservation
in past farm bills. I think in this new farm bill conservation
must once again be an integral part of farm policy. In fact, I
would go so far as to say that in the next farm bill I think
that conservation ought to be the centerpiece of our next farm
policy because it encompasses, really, everything we are trying
to do.
I will get into that more later on, but I think it ought to
be the centerpiece of our next farm bill.
It goes without saying that our farmers and ranchers are
facing stiff economic challenges, low prices for their crops.
Our rural areas are being decimated and we need a different
view on how we can reach out to help our farmers and ranchers
and at the same time give them the tools and the expertise and
the financial help that they need to continue to be good
stewards of our soil and water and air.
With that, Mr. Chairman, again I look forward to the
testimony from our witnesses. Thank you again for holding these
very timely hearings.
[The prepared statement of Senator Harkin can be found in
the appendix on page 142.]
The Chairman. Well, thank you very much, Senator Harkin. As
if obvious, I share Senator Harkin's view of the importance of
the conservation title. That is one reason that we both decided
to have these hearings first.
We had one hearing from the Commission that was mandated by
the farm bill, summarizing an overall national point of view.
But in terms of chapters or categories, this is our first
attempt and we believe it is an important one.
I want to recognize Senator Thomas if he has an opening
comment this morning.
STATEMENT OF HON. CRAIG THOMAS, A U.S. SENATOR
FROM WYOMING
Senator Thomas. No, Mr. Chairman. All of us are having to
come and go. I just would make the observation that I agree
with what both of the gentlemen have said. It does seem it is
our responsibility to examine and see which of these several
programs are the most efficient and effective, how could they
be done more efficiency, should some of them be combined and
where should our priorities be. It seems to me those are
important issues as well.
So thank you.
The Chairman. Thank you very much, Senator Thomas.
Let me introduce now the first panel this morning. First of
all, Mr. Craig Cox, the Executive Director of the Soil and
Water Conservation Society, a former Senate Agriculture
Committee staff member for Senator Leahy.
Mr. Cox moved to the USDA as Acting Deputy Under Secretary
for Natural Resources and Environment before taking his current
position with the SWCS. The SWCS is an international, nonprofit
organization of conservation professionals.
It is a special pleasure to greet Mr. John Hassell, who is
Executive Director of the Conservation Technology Information
Center [CTIC], which is based at Purdue University and a part
of the National Association of Conservation Districts and a
public-private partnership.
CTIC promotes the use of conservation tillage and residue
management in ways to protect water quality. They also promote
watershed planning as a basis for protecting water quality.
Mr. Nathan Rudgers is Commissioner of the New York State
Department of Agriculture and Markets. He represents the
National Association State Departments of Agriculture. We are
delighted to have you on the panel this morning.
As Senator Harkin has mentioned, Mr. Paul Johnson is first
of all an Iowa farmer. He is a former Chief of the Natural
Resources Conservation Service and former Director of Natural
Resources for the State of Iowa. Mr. Johnson testified at the
Senate Agriculture Committee hearing reporting IDNR on the
total maximum daily load issue last February. We appreciated
that testimony.
He lives on a farm in Iowa and is testifying today as a
farmer.
I will ask each of you to testify in the order that I
introduced you, starting with Mr. Cox. If you could summarize
your remarks in 5 minutes, that would be great. We will be
somewhat liberal in allowing some spillage beyond that, as you
have seen our practice before. But to the extent that we can
have those summaries, we will get into the questions that the
members will want to raise with you.
Mr. Cox.
STATEMENT OF CRAIG COX, EXECUTIVE DIRECTOR, SOIL AND WATER
CONSERVATION SOCIETY, ANKENY, IOWA
Mr. Cox. Mr. Chairman, Senator Harkin, and Senator Thomas,
I want to thank you so much for the opportunity to appear
before you this morning, and particularly on such an issue that
is so critical to agriculture and to the American public.
I would like to applaud you for taking conservation on so
early in this process. I think that sends a good signal to all
of us who are so concerned about American agriculture and the
American landscape.
The Soil and Water Conservation Society held a series of
workshops last year. We are in the process now of analyzing the
content of what we heard at those workshops and what it should
mean for reform in the farm bill.
We will issue a report in April with a set of detailed
recommendations that we hope will be of service to you in your
work on the Farm bill provisions.
But even our preliminary analysis to day, I think, makes
three things clear that perhaps respond to some of the
questions, Mr. Chairman, that you asked at the outset. First
off, we found that people are worried. Participants across the
country universally reported that USDA conservation programs
are not meeting their critical need for assistance, both
technical and financial, to deal with the environmental
problems that they face.
That is making them worried both about the environmental
and making them worried about the sustainability and future of
the farms and ranches in their community.
The second thing we heard that was clear is that in this
case money matters a lot. Participants across the board wanted
significant increases in existing conservation programs in
order to address these critical natural resource needs. In fact
analyzing the proposals from participants for increased
funding, we come up with a proposal to double funding for
existing conservation programs to create about a $5 billion
annual program.
That, in the opinion of our participants, would be a
sufficient investment to deal with the most basic needs of
agriculture in terms of ensuring the sustainability of the
agricultural enterprise by improving its environmental
performance.
But, in fact, participants want to do much more than that.
That is what they are worried about. But what they hope for is
an investment sufficient to go beyond pollution prevention and
go beyond damage control to actually encourage widespread
enhancement of the environment across this country.
In that context, our participants are really envisioning
about a $10 billion annual conservation baseline program.
Now, I know at first blush talking about increases of that
magnitude might seem outlandish, but I think if we take them in
perspective we get a different view. Creating a $5 billion
annual baseline would be an increase comparable to what you
accomplished in the 1985 Farm bill.
A $5 billion annual program would be about 20 percent of
what we spent last year in income and disaster assistance to
farmers. Now, even a $10 billion baseline would make this
conservation effort about 10 percent of the total program
outlays projected for USDA in 2001.
We heard yesterday a report of over-subscription rates of
three, five or six times what we are able to satisfy with
current funding. So in that context, perhaps a $10 billion
increase seems almost conservative.
The other thing we thought was clear is that there is no
single program or authority that can address all of these
concerns. What we really need is a comprehensive conservation
title that has the following components, we think:
First, a major emphasis on technical services and technical
assistance, a major new emphasis on assistance to working lands
and farmers producing food and fiber whileprotecting the
environment.
Strengthening our land retirement programs that thankfully
we have in place today, leveling the playing field so good
stewards are rewarded and not penalized for what they do and
creating more authority and flexibility at the State level to
tailor these programs to unique circumstances.
I think, in conclusion, taking these kinds of actions
would, in fact, move conservation to the center of farm policy
with tremendous benefits both for the American public and, I
think, for the agricultural community itself.
Again, thank you for the opportunity to appear here today.
The Soil and Water Conservation Society would be more than
willing to do whatever we can to help you in the months ahead
as you shape critical conservation policy for this country.
[The prepared statement of Mr. Cox can be found in the
appendix on page 144.]
The Chairman. We thank you for your testimony and your
specific listing of objectives, funding as well as
organization, of this title.
Mr. Hassell.
STATEMENT OF JOHN HASSELL, EXECUTIVE DIRECTOR, CONSERVATION
TECHNOLOGY INFORMATION CENTER, W. LAFAYETTE, INDIANA
Mr. Hassell. Better soils, cleaner water for our nation's
environment and greater profits and a brighter future for our
farming families. I want you to know that this is the message
that we receive from farming families across the nation as we
go out and talk about conservation programs.
Good morning, Mr. Chairman, and members of the Committee.
As I was introduced, I am John Hassell with the Conservation
Technology Information Center, a nonprofit, public-private
partnership. We are a part of the National Association of
Conservation Districts; however, we are separately governed by
a board of 25 directors, made up of industry representatives,
farm press, conservation groups, environmental organizations
and producers.
We also have nine cooperating Federal agencies that provide
assistance to us. So we are truly a public-private partnership
promoting conservation on America's working lands.
What I wanted to do today was deliver to you information on
three points: One, information about the work that CTIC did
during the 1985 and 1990 farm bills, a new initiative called
Core 4 Conservation on which I have handed out some information
to you, and also recommendations for the next farm bill that
came from the NACD Farm bill task force.
CTIC was previously known as the Conservation Tillage
Information Center and was started to promote conservation
tillage and residue management. CTIC supported the 1985 and
1990 farm bills by instituting what was known as the Crop
Residue Management Initiative. We worked with producers to help
them meet the compliance portion of their conservation plan.
Because of this effort, 75 percent of the compliance plans
that were written included Crop Residue Management. If you go
back and look at the chart that I handed out to you earlier,
the blue and red one; one side shows No-Till Adoption and Soil
Erosion and the other side shows Conservation Tillage Adoption
and Soil Erosion. Both show that during this Crop Residue
Management Initiative, that we had an increase in conservation
tillage adoption and no-till adoption and a decrease in soil
erosion.
[The information referred to can be found in the appendix
on page 169.]
This is really significant. If you look at where both
flattened out, this is when CTIC dropped its Crop Residue
Management Initiative. There is quite a correlation between the
two.
We believe that this particular initiative was a success
for several reasons. One is that we are a public-private
partnership that worked toward a common goal. There was new
technology available that allowed no-till implementation to be
successful and be delivered.
The third was that we had a national marketing campaign
that delivered a consistent message about the benefits of crop
residue management.
Now, our new initiative is something that we call Core 4
Conservation. I am going to tell you the principles several
times because I don't want you to forget them. The principles
of Core 4 Conservation are: Better soil, cleaner water, greater
profits and a brighter future.
Core 4 Conservation utilizes a systems approach to land
treatment that provides environmental benefits while at the
same time looking at the economic benefits to producers.
So many times in environmental programs we push the
environmental end and we never come back and talk about the
economic benefit to the producer. Producers are a lot more
likely to adopt something that is economically beneficial to
them as opposed to environmental, even though they want to do
the right thing.
The practices that we recommend under Core 4 Conservation
and the systems approach are: conservation tillage, buffers,
nutrient management, and integrated pest management, along with
other practices that would be determined upon a site-specific
approach.
We understand from the scientists and experts that have
looked at these practices, that we can address 80 percent of
the environmental issues on cropland if we use this approach.
That is significant.
I believe that Core 4 Conservation is also a banner for all
of agriculture to rally under. I really believe that today
agriculture is somewhat fractured and we really need something
that we can all unite under.
The goals of Core 4 Conservation are very clear and
concise: Better soil, cleaner water, greater profits and a
brighter future.
Members of the CTIC Board of Directors were participants on
the NACD farm bill task force. They took the Core 4 concepts to
that task force and they were implemented within the proposals
of the NACD final report. In that final report, and we agree
with this, and it does meet Core 4 Conservation, we want to
maintain a voluntary incentive-based approach. We think that
this is extremely important:
Increasing local involvement in setting priorities and also
in carrying out programs; utilizing science-based technology to
make decisions; and increasing the technical assistance.
The task force also saw that there was something missing,
so they recommended the Conservation Incentive Programs similar
to Senator Harkin's proposal that would reward producers for
being good stewards.
Now, the best intended programs are doomed to fail without
a mechanism for implementation. I think that we need to
continue to utilize the 3,000 local conservation districts as a
delivery system and at the same time we need to increase the
funding for technical assistance through our partners, the
NRCS.
Federal programs can't do it alone. We need the private
sector involved in it. We are a public-private partnership and
the private sector not only brings the necessary resources to
promote conservation to their constituents, but they also
provide us with cutting edge research and products that make
conservation affordable and achievable for American farmers.
Without a vision on how American agriculture will profit
and thrive in the future, any conservation program will fail.
We need a mechanism for delivering information to
agribusinesses, to technical advisers and producers.
We believe that Core 4 Conservation does have that. I think
that you will agree that everybody can buy into this approach.
I believe that if we look at better soils, cleaner water and
greater profits for farm families that will result in a
brighter future for all of us. Core 4 Conservation is
conservation for agriculture's future.
Thank you.
[The prepared statement of Mr. Hassell can be found in the
appendix on page 156.]
The Chairman. Thank you very much, Mr. Hassell.
Mr. Rudgers.
STATEMENT OF NATHAN RUDGERS, COMMISSIONER,
NEW YORK STATE DEPARTMENT OF AGRICULTURE
AND MARKETS, NATIONAL ASSOCIATION OF STATE
DEPARTMENTS OF AGRICULTURE
Mr. Rudgers. Good morning, Mr. Chairman, Ranking Member
Harkin and Senator Thomas. Thank you for the opportunity to
offer testimony this morning on the conservation provisions of
the next farm bill.
My name is Nathan Rudgers and I am the Commissioner of
Agriculture from the State of New York. I am here today,
honored to represent the National Association of State
Departments of Agriculture. I am joined this morning by
Commissioner Robert Wells, from Alaska and Director Joe Hampton
from Illinois, who have chosen to join us this morning as well.
Today I will present a broad outline of a new environmental
program for America's open space resources that are under the
care and stewardship of agricultural producers. I would like to
stress that this proposal is a work in progress. It is the
product of extensive discussions over the past several months
among commissioners, secretaries and directors of agriculture
representing all regions of the country.
It was formally adopted as NASDA policy during our mid-year
meeting on Monday. We will further refine our proposal in
upcoming months based on continued discussion with other
stakeholders and the input from this committee.
While we support the continuation of the existing
conservation programs and increased funding of those programs,
we are recommending certain changes in WHIP, EQIP and CRP. For
example, NASDA recommends that USDA give State more flexibility
and discretion in administering the EQIP Program by allowing
one-year contracts, removing the payment cap, and removing the
national size restriction for livestock projects.
These and other proposals are described in detail in my
written testimony.
Despite the overall usefulness of existing programs, we see
gaps in coverage that are probably inevitable in any set of
programs designed with the entire country in mind. In addition,
we have seen that Federal environmental regulation and policy
has evolved to further address issues such as concentrated
animal feeding operations that were probably not prominent when
existing conservation programs were designed.
Because meeting changing environmental demands is a make-
or-break challenge for certain producer groups, many of our
State departments of agriculture have taken the initiative to
design their own programs tailored to address resource needs
unique to their States that cannot be met by existing
conservation programs.
For example, through the leadership of Governor Pataki New
York has a highly successful Agricultural Environmental
Management, or AEM, Program. It offers technical and financial
assistance in nutrient management planning and cost share
assistance for improvements carried out under approved plans.
The primary goal of this voluntary, incentive-based program
has been to assure that New York farmers can meet environmental
requirements while maintaining the economic viability of the
farm.
The AEM Program is a partnership effort with local sewer
and water conservation districts and NRCS field staff, as well
as staff from my department, Cooperative Extension, farmers and
people in the community.
AEM and similar programs in other States supplement
existing Federal conservation programs while helping farmers
bear the cost of what we see as substantial public benefits
such as open space conservation, resource preservation for
future generations, clean air and water.
Just as the Federal Government has provided cost sharing to
help local governments upgrade water treatment infrastructure
to meet Clean Water Act requirements, we believe the Federal
Government should provide assistance to States to help farmers
and ranchers meet environmental requirements.
Moreover, this assistance should be provided with enough
flexibility so that States can target these funds to their own
resource needs.
Consequently, we are recommending the establishment of a
new block grant program for agriculture environmental
stewardship with these guidelines: First, money would come
through cooperative agreements between USDA and State
Departments of Agriculture which would be the lead agencies in
designing and carrying out these programs.
Second, program parameters would recognize activities that
enhance protection of land, air, water and wildlife, defined in
the broadest terms possible to permit local flexibility while
avoiding duplication of existing planning systems and
infrastructure.
Third, States would have the flexibility to allocate
dollars between payments to producers and/or technical
assistance based on local needs and priorities.
Fourth, producer participation would be voluntary,
incentive-based and targeted towards those environmental
enhancements supported by sound science and producing
measurable results.
Fifth, contract payments to participating producers would
be made on an annual basis.
Finally, all programs would have provisions to protect
individual producer privacy and data confidentiality.
We note that expenditures in the environmental area are
likely to be considered ``green box'' payments in the context
of our WTO commitments, since their impact on commodity output
would certainly be neutral.
We are also sure that our proposal will keep farming
operations that are most heavily burdened from failing while we
work to improve opportunities for growth and profitability in
agriculture as a whole.
Speaking for all my State colleagues, I appreciate the
opportunity to present views on how we can support good
agricultural environmental stewardship in every region of the
country.
We look forward to working with the Committee on
development of a Federal agricultural policy that provides
necessary tools for a healthy and profitable agricultural
industry that helps farmers continue to be good stewards of the
land.
Thank you.
[The prepared statement of Mr. Rudgers can be found in the
appendix on page 171.]
The Chairman. Thank you very much.
Mr. Johnson.
STATEMENT OF PAUL JOHNSON, FARMER, DECORAH, IOWA
Mr. Johnson. Thank you. Senator Lugar, Senator Harkin and
Senator Thomas, it is an honor to be here today to share some
ideas with you.
Since Aldo Leopold was already mentioned, I think I will
start with a quote from him written more than 60 years ago when
he wrote that ``It is the American farmer that weaves the
conservation carpet on which America stands.''
He went on to say, ``Should he weave it with the sober
yarns that warm the feet or shall he also add the colorful
yarns that warm the heart and the eye.''
I think we can say at this point that we do have the sober
yarns woven into America's land. It has come about because of
through work that you have done in this committee and the
conservation policies that you have put together over the
years.
At that same time, 60 years ago, Hugh Hammond Bennett, the
first chief of the Conservation Service was up here and
actually delayed a hearing similar to this until the storm
clouds moved in with dust from the Great Plains. Out of that
hearing came the Soil Conservation Service.
I won't delay. On the other hand, within 2 months the Des
Moines River will probably be very high in nitrates to the
point where the largest nitrate removal plant in the country
will not be able to handle it. We will ask people to not give
babies water from Des Moines.
We do still have problems. We have made great progress. We
do have problems and that is what we are about here today.
You are very important. If you went out and asked Americans
where conservation and environmental protection takes place in
this town, they will tell you the Department of Interior and
the EPA. I would suggest you are more important than both of
them put together, particularly over the next decade as we
craft our policy. I don't need to tell you, most land is
private. Most wildlife habitat is on private land. Most air
quality, most water quality at this point is dependent on what
you do. Your failure to act has consequences that I think we
have all talked about.
None of us like to farm under a heavy regulatory hand. Yet,
I think that will come if we don't continue to make progress.
I would like to suggest five ideas for your consideration
as we move forward. First, I would suggest that you look at
crafting a clear, unambiguous national private lands
conservation act.
Every 5 years or so we talk about conservation as
productivity of a farm bill. I think this is where it belongs,
in this committee. But just as we have a Wilderness Act and we
have a Clean Water Act and a Clean Air Act, places where the
Nation focuses on these issues, I think it is important that we
consider doing that for private lands as well.
We suffer from a lack of support and a lack of
understanding across this country. I think that something like
that could help to do it. I don't know exactly how it should be
done, but I think it should be a fascinating task to begin. I
suggest that you take a look at that.
I believe that it is time that we set a national goal to
make sure that a basic conservation carpet covers all of our
land, cropland, grazing land, and non-industrial private
forestland.
I think that we know how to do it. We have been at this 60
years now. I think we know how to be landowners to do it. It is
called ``money.'' The conservation payment to every landowner
in the country who is willing to achieve a sustainable level of
soil conservation and water protection would do more to advance
conservation and environmental protection in our country at
this point than anything we have ever done. I think you ought
to consider that.
Craig Cox mentioned $10 billion. I think that he is in the
ballpark. Can we do it? We are the wealthiest Nation this world
has ever seen. We are in good shape right now as well. I would
urge you to take a look at that.
Leopold once wrote that, ``Conservation occurs when the
farmer takes care of land, but also when land takes care of the
farmer.''
I think that a basic conservation payment for doing basic
soil and water conservation will do more to have take care of
farmers across this country than just about anything else we
could do as well. So as you talk about conservation policy, I
would certainly include that.
You have a wonderful set of tools to put those colorful
yarns into our carpet, CRP, WRP, WHIP, EQIP, Farm Land
Protection. All of these are very, very good programs and I
would urge you to keep them. They all need additional funding.
I think they all need more flexibility as well.
I will cite an example of the continuous CRP. In Iowa, if
you have a waterway that you put in 10 years ago because you
were a very good farmer you are not eligible for a CRP
contract. If you plow it out and put soybeans in it for two
years and come back, you will get it in. I think this is
downright dumb. I think that it needs to be changed.
While we are on that issue, I think the possibility of
partial field enrollment, small pieces of a break in a field or
a corner that is hard to farm, if it meets a high enough EBI, I
think it ought to be included in that CRP as well.
Imagine a working land across this country that has a good
conservation carpet in it with residue management and good
nutrient management and at the same time has these colorful
pieces throughout it of wildlife habitat. I think it would be
an exciting landscape for us to work on.
The conservation infrastructure is in place and I think
many people in front of you have suggested that we need
additional resources there.
When I came in and headed up the NRCS in 1994, I was handed
a ten percent cut. We lost ten percent of our people across
this country. These are conservation technicians and soil
conservationists. Don't let that happen this time. I think a
Nation that is so well off, please don't let that happen.
Number five, I would certainly expand our research in
conservation. I view the commodities, things that come off of
good conservation as conservation commodities, whether they are
clean water or wildlife habitat.
I would suggest that you put a great deal more effort into
the research to make sure that we can provide these
conservation commodities to the American public.
Thank you for the opportunity to be here. I will be open to
further questions or comments.
[The prepared statement of Mr. Johnson can be found in the
appendix on page 182.]
The Chairman. Well, thank you very much, Mr. Johnson.
As an overall comment, let me make the point that your
papers all of them, will be made a part of the record in full.
They are a comprehensive chapter in themselves in terms of
their recommendations.
For instance, the broad idea of having, as you were
suggesting, Mr. Johnson, conservation acts equivalent to the
Wilderness Act or Clean Air Act, or what have you is a
remarkable concept itself.
As I read your paper before you came, I was still trying to
envision technically how we do that, not that it is impossible
in this Congress, but nevertheless, trying to think through the
jurisdictions. It is generally agreed among our colleagues that
we have jurisdiction to deal with CRP and WHIP and what have
you.
Perhaps our ambitions should be broader or should take
others into consideration. But it is an interesting idea,
certainly. I just wanted to comment, Mr. Cox. Imbedded in your
paper is some very interesting data in which you point out, as
some others have, that about 36 percent of farmers currently
receive farm payments, as we think of these, trying to
supplement income, a safety net.
Your suggestion is that that could be a much broader net if
we centered much more of our income sufficiency on the
conservation situation, not supplanting the crop-by-crop or
category-by-category idea, but nevertheless, historically, the
program crops whereas other programs have come in and we have
tweaked the system to try to use those programs.
Each of you in a way has talked about this broad carpet of
land in our country, the stewardship that is involved, how
comprehensively, either State by State or as a Nation, we try
to coordinate this.
So I thank you, really, for the height of your imagination,
but likewise your experience in dealing with all of this.
Now, let me just pick up one thought that was given to me
yesterday by an official in my own home State who has taken
responsibility for conservation and soil programs and what have
you. She pointed out that in Indiana-- and I was not acquainted
with is the whole digital process now where all of the soil
types for farm by farm, county by county, may be available
fairly shortly on the Internet or at your personal computer--a
farmer can take a look at what his or her land looks like.
In fact maybe even an evolution of this would be to be
various overlays on this. This is an exciting idea. It hasn't
happened yet in Marion County, Indiana, but will, I am advised,
maybe within 18 months or so. So this is a way all of us can be
better informed wherever we are sitting about the precise soil
situations that we have now and the possibilities for the land
for which we have some stewardship.
Along with the information, of course, comes the
possibility for responsible action for the type of promotion,
public relations, that have been discussed today.
Just as I say, as we started out with the farm bill, in
trying to think through, given your guidance today, what do we
do on the general support of American agriculture through
money?
Mr. Johnson says it helps to solve a lot of problems. Where
should the money go? One way, as you are suggesting, Mr. Cox,
but I want all of you to comment, is that much more of our
support as a people, as a Federal Government, should come
through the conservation, through the stewardship of land
situation, perhaps as opposed to bushel-by-bushel subsidies or
crops or what have you?
I am not certain, as we have other panels that will come
in, that everyone will agree with that. As a rule, when we take
up farm bills, we hear from wheat growers, corn growers, cotton
growers, rice growers, category by category, vegetable and
fruit growers, people in sugar, tobacco, a lot of people who
have very specific and urgent needs for preservation of what
they are doing.
Occasionally, somebody comes in with the whole farm idea
that we ought to be supporting whatever people want to do as
opposed to doing it category by category because some
categories always get left behind, may not have been a part of
the last farm bill. So they try to get additional support in
the next one.
But what you are suggesting is really something more
fundamental than whatever the produce happens to be from this
process and that is really the land, the stewardship, the basic
assets that we are stewards of for a fairly short time, but are
a part of our national heritage, maybe much more a part of our
national responsibility.
Do any of you want to venture into this dangerous territory
and comment about money? Now, you might say, well, we should do
all of the above. In other words, there is nothing wrong with
supporting the price of corn, but at the same time, why, I do
believe something more for stewardship of the land and maybe
that is what we will end up doing.
My guess is ultimately there will have to be decisions in
terms of priorities. Some things are likely to be substituted
in part, not in full. So if you can, give us some underpinnings
that we ought to be thinking of.
Who of you would like to start?
Mr. Rudgers. Mr. Chairman, I think it is very important to
the Commissioners, Secretaries and Directors of Agriculture
across the Nation that the next farm bill really be an
integrated approach.
Let me offer a thought as to why conservation programs and
additional assistance in the area of conservation has a direct
impact on all those commodities that you mentioned.
We are expected to compete globally and most, if not all of
the commodities you mentioned have an export outlook. Their
future success is tied to their ability to export. In order to
do that, they need to be competitive. In order to be
competitive, they need to have a level playing field.
That are expectations in this country and environmental
action and environmental care on our land is very high. In
order to meet those expectations, producers are already
expected to provide significant impacts on their land and
within their livestock operations.
In order to be competitive, though, they really need
additional support and additional investment to level that
playing field. That is why this type of an approach fits very
well with the commodity programs as well.
The Chairman. Mr. Johnson.
Mr. Johnson. In 1985, with the Food Security Act, we put
together conservation compliance. We said that if you receive
these supports of various kinds, then you meet this basic
requirement.
As we moved away from that, and I am not quite sure where
you are going to go this time around, but as we move away from
it, we lose that connection. That is why I suggest the basic
conservation payment to meet basic soil conservation
requirements and basic--probably nutrient would be the key
issue when it comes to water quality, that plus soil
conservation.
We are spending, still, in the neighborhood of $20 billion
a year or more in agricultural policy. There are many ways to
get that money to support agriculture.
The problem out across the countryside today, as I see it
from where I am, is what is the Nation getting in return for
this? I think to shift a good chunk of that to paying for
conservation commodities, and these are things that the Chicago
Board of Trade doesn't pay you for. Yet, they are extremely
important to the American public. That is one way to look at
it, to move in that direction, I think.
I would urge you to take a look at that. I know that is a
radical change from where we have been. There are those who
will say, ``But farmers will do it anyway, so why should we
worry about it?''
Well, everywhere else in our society we get rewarded for
doing good things. I think most farmers will go above that with
those colorful yarns that I was talking about. But that basic
conservation mat across the country, I think the public would
be very pleased with.
The Chairman. Well, it is an unusual but important
responsibility for this committee. Some would see this
committee as being purely advocates for producers. What you are
suggesting is that the committee should be advocates for the
total American public.
Mr. Johnson. That is right, but the producer gains from it
as well and has some security. We have talked often about
revenue assurance for agriculture. What better way to do it
than this?
Mr. Cox. Mr. Chairman, I think the question you ask is very
fundamental. The way I think about it is you are really asking
what do we want from agriculture? There are some other numbers
in my testimony that I find even more shocking in that 8
percent of farmers produce over 70 percent of the monetary
value of agricultural production. From a conservation point of
view they are doing that on only 32 percent of the acres in
farms.
Not to be, perhaps, too outspoken, but if all we want from
agriculture is abundant supplies of food and fiber, it is hard
not to come to the conclusion that we can do that with fewer
farmers and fewer acres in production.
I think moving conservation to the center provides us a way
to engage much of the rest of agriculture in a way that
produces something in addition to food and fiber, which is
environmental enhancement.
I wouldn't tread too deeply into suggesting how you balance
traditional commodity support objectives with conservation
objectives, but if there is a bright spot, it would be that
perhaps moving conservation to the center would provide
additional options for producers, especially those producers
who really aren't touched by the existing commodity programs
and yet still have the same responsibility to manage their
lands as those farmers and ranchers who are being supported
through commodity programs.
So it may be that bringing conservation to the center could
allow you to fashion an agricultural policy that is tailored
more to the realities of the diversity of agriculture and more
to the realities of the structure of agriculture.
Maybe perhaps even achieve some cost savings from having,
essentially, a one-size-fits-all commodity program that works
well for some producers and maybe not so well for other
producers and yet costs a fair amount of money.
The Chairman. Mr. Cox, you have introduced an idea. I think
one of the Sparks, Incorporated reports gets into structure. I
cited that in another hearing. But 8 percent of the entities
that are family farms, with $1,000 in sales or more qualifying
to have a farm entity. There are about 1.9 million such
entities in our country.
But just 8 percent of these, 160,000, do produce, I think
according to Sparks, much more than 70 percent of everything
that occurs. If you take the next 10 percent, another 18
percent of the farms do at least 7/8ths of all the business.
This leaves 82 percent of entities, 1.5 million plus.
Sparks would contend that 100 percent, on a net basis, of the
income of all of these farms comes from off the farm. This
doesn't mean that some of the 1.5 don't make some money, but
the rest lose enough that as a net group 82 percent are getting
all their money from off the farm somewhere and almost making
nothing on the farm.
That is a structural revolution that is not well
understood. But we sort of plow into a farm bill thinking about
1.9 million farms, as you say, one-size-fits-all, something
that is sauce for the goose is sauce for the gander, but
without relationship to who is there and what they are doing.
But now this is a radical suggestion that you are making
because some would say the purpose of agriculture is to produce
food and fiber. That is what the public interest is.
Now, you are saying, well, that is a part of the public
interest, but as a matter of fact, it is being satisfied,
roughly, 7/8ths of it, by very few people.
So what about the other 4/5ths? Because these are people
who are farming or tending or conserving land for the rest of
America. If I gather, and I don't want to put words in your
mouth, but you are saying the major objective of agriculture in
America ought to be the support of these people, in essence.
Further, if we are going to have a public interest, it ought to
be principally geared to that, as opposed to the 8 percent who
are corporate, commercial, family, but in any event, good sized
farmers with entities that are currently among, I suppose, the
36 percent of farms that you point out get some money. The
other 64 percent don't.
Do you want to amplify further or am I mischaracterizing
where you are headed?
Mr. Cox. No. I think you are characterizing it correctly. I
think, you know, what makes agriculture unique as an economic
sector, I think what really makes agriculture unique is the
land. I mean there is no other sector of our economy in which 2
percent of our population is entrusted with the care of over 50
percent of the land in the United States.
If there is anything about agriculture that is different
than the local dry cleaner or the hardware store, it is because
of both the responsibility and the unique characteristic of
farmers and ranchers as the fundamental land managers and
environmental managers in this country.
I want to make clear that the top 20 percent who are
managing all this land and producing all these commodities will
need environmental assistance. But they may need a very
different kind of environmental assistance than the large group
of individuals who are managing the largest portion of our
landscape.
So I don't think we can ignore the top producers, so to
speak, from an environmental point of view. But what the
changes in structure does provide is a real opportunity to
clearly recognize as a public the responsibility and the
opportunity of harnessing the skills and labor and management
of that large group of producers out there specifically for
environmental enhancement.
The Chairman. Mr. Hassell, do you have a thought about
this?
Mr. Hassell. I think that is real interesting when we start
looking at the environmental issue because the agricultural
community is affected by it tremendously today.
When you look at some of the reports that are turned out,
whether they are accurate or not, they are still public record
about agriculture being the leading non-point source
contributor today. That is disturbing to me, working in
agriculture, because I know there are a lot of people out there
that do good work. One of the things that I think, and the
point that I want to make is that--and somebody said this
yesterday--we don't have the dust storms like we did 50 or 60
years ago. We don't see this environmental challenge out there
that we have to work with.
But you know what? Conservation is every day. It is not a
one-time fix. We go out and we take land out of production to
put it into CRP lands or wetlands or whatever, and that is good
because they are probably lands that needed to be taken out.
But we also need to be looking at those lands that are in
production and providing conservation support for those so that
we can continue to have a good, cheap, healthy supply of food
and fiber and energy.
A recent report came out, and I can't cite who it came
from, that the majority of the soils within our world today are
degrading at a faster rate than they were assumed to be
degrading 20 years ago. We lose almost two million tons of
topsoil per acre in this country of ours. That topsoil takes
years to reproduce or to produce the amount that we lose.
Paying for conservation on working lands is probably one of
the most important things that we can do. Less land is
available today for food and fiber production than there was 25
or 30 years ago and we continue to have more and more taken out
as we get urban encroachment and other types of activities that
do that.
So conservation on these working lands is probably one of
the most important things that we need to do if we are going to
provide the food and fiber to this country and other countries
at the cost that we provide it today.
The Chairman. Thank you.
Senator Harkin.
Senator Harkin. Well, Mr. Chairman, thank you. This has
been a fascinating interchange because we are getting into some
of the philosophical basis of what we are going to do on this
next farm bill and how we are going to move.
It seems to me that what we do here sends signals topeople
as to what they ought to do and how we ought to act. Many of
our programs over the last 15 years or so have been really
geared towards income support based, as the Chairman said, on
the bushel basis. How much you produce, that is what you get
supported on. That is the bottom line factor.
So what that has done is it has sent a lot of signals to
get bigger and get bigger and get bigger, because the bigger
you are, the more you produce and the more you get. So we sort
of sent those signals out.
I think now there is question as to whether or not we ought
to continue to send those signals. This is the chart here that
you were talking with Mr. Cox about. It is a little worse than
what you said. It is $32 billion that we outlaid last year for
all payments to farmers and $1.9 billion in conservation.
Your figures were at 2.5. But it is really $1.9 billion in
conservation. So we spent $32 billion. Again, AMTA payments
went out. A lot of people got the AMTA payments. It was not
related to price. It wasn't related to anything. It just went
out. A lot of these people got AMTA payments that weren't even
producing anything.
There have been a lot of questions raised about that, about
whether or not that was a wise thing to do, just continue to
give those AMTA payments.
Well, if we are going to take this amount of money next
year, and I hope we will have at least that much in our
baseline budget, do we want to continue to do that or do we
want to refocus it?
I think you are suggestion of going up, doubling, is a
little low. I think it ought to be more than double. EQIP, we
heard yesterday, had a four to six times greater demand than
the funding available; farmland protection, six-times greater
than the money available; and wetlands reserve, five-times the
level of funding in terms of the requests. There are probably
more. Those are the ones I just happen to have handy.
I think the idea, if you get down to the philosophy of
this, as Paul Johnson said, and I wrote this down: ``The
conservation commodities.'' Well, why don't we look upon it as
a commodity? People say, well, you can't eat it. It doesn't
really make you money. So how can it be a commodity?
Well, maybe it is like a reservoir. Maybe it is just
something that you store up and you keep for the future, just
in case, aside from the Leopold concept of the aesthetic value
and what it means for just warming the eye and the heart.
Perhaps we ought to consider how this might be a reservoir
of land that we keep for generations. Whereas a reservoir might
not make you any money right now, but gosh, if you have a
drought and you have to use that water, it is sure nice to have
had that reservoir.
So maybe that is the way we ought to look upon
conservation, as a commodity that we have to invest in now for
future generations. Hopefully, we can move ahead in that
direction. I still think it should be the centerpiece of our
next farm bill.
Mr. Rudgers talked about State involvement. One thing I got
to thinking about when I was reading your testimony and
listening to you that occurred to me, is if we are going to be
refocusing efforts to put money out there for incentive
payments on conservation, should we require State matching
moneys? The only reason I say it is because if you are going to
have the State involved and your testimony was about keeping
the States involved, should we have State matching
requirements?
Mr. Rudgers. There are many examples already where States
are contributing significant investment into these activities.
So the answer to your question is yes. However, the challenge
is what level of investment do States have in making that
approach be fair across the Nation.
For example, in my State, not only do we have State
contribution significantly for farmland preservation and for
non-point source pollution abatement, but we also have
participation of the City of New York in the Watershed
Agricultural Council, which over several years has provided $35
million in funding to provide improvements on the land for the
farmers in that watershed because the city recognized the value
of keeping agriculture as a preferred land use in that
watershed and helping farmers stay on that land.
The alternative is development, the loss of that land for
the water quality benefits that it provides in the hands of the
steward, namely the farmer.
You have across the Nation several examples of State
investment. So I think that is a reasonable expectation. But I
think to set a certain percentage would probably be unfair.
Senator Harkin. Well, I am just trying to get more bang for
the buck, obviously, here.
Mr. Rudgers. Absolutely.
Senator Harkin. I don't want to have something out there
that would discourage people from being involved in
conservation because the State didn't do something. But on the
other hand, if we could get this up to, say, $10 billion, for
incentive payments for farmers, which I hear all of you sort of
saying, one way or the other, if we could get the State to come
in with a little bit, we could leverage that money up a little
bit.
Mr. Rudgers. I don't have this answer, but it would be
interesting to see what that number looks like if you add in
the State contributions that are already in place.
Senator Harkin. We ought to do that. I would like to find
that out, what States are doing out there and what they have
put into that in the past and add that on top of that. That
would be a good figure. Does anybody else know that figure?
Of the total spending that we spend here, how much have the
States kicked in of their own money. Do you have any idea,
Paul?
Mr. Johnson. It really varies from State to State. Some
States have a huge amount going into it. Missouri, for example,
has a dedicated percentage of a sales tax going to
conservation, both soil and water and wildlife.
The State of Iowa probably matches the cost share funds
that we put out through the USDA. Other States may have almost
nothing. So it really does vary from State to State.
Senator Harkin. Any other thoughts on matching requirements
at all? I don't know if you have any thoughts on that at all.
It might be one way of leverage. I have to get some data on
that to find out what the States are doing.
The other thing is what you talked about earlier, Paul, the
National Private Lands Conservation Act. You have talked about
this before. Is there anything out there? Is there any kind of
a draft proposal on that floating around anywhere?
Mr. Johnson. I certainly don't know of one. We have a
process that goes on that certainly ought to be folded into it,
the RCA process that reviews private lands, agriculture lands
in particular, every few years. So we wouldn't be starting from
scratch.
My concern is to get it elevated to the point where America
understands the good that agriculture does in providing
conservation benefits to our Nation. Right now, as I say, go
out on the mall and ask people where conservation takes place
and they will point to Interior or EPA. They won't even look at
Agriculture.
Yet, as I said, we are more important, I believe, if we do
it right. So if this committee would call for the beginning of
that process, I think there are a lot of good minds in this
country that would love to work on it with you.
Senator Harkin. The last thing I would say is that all of
you seem to agree on at least one thing and that strain through
all of your testimony is this present system that we have where
if you have already been practicing good conservation you don't
get anything, but if you haven't been and then you start, you
get something. That is just nonsense.
We ought to come in and start helping those people who have
already been practicing good conservation, who have put in
their waterways and put up their buffer strips and things like
that. A lot of people have done this on their own. Farmers who
have spent their own time, their own money, their own labor and
their own equipment-it is like you say, the only way you are
going to get it is plow it up, put it into soybeans and then
put it back in again, then you are going to get something. I
think that is nonsense.
So I think all of you have said that we have to come in and
at least provide support for those farmers and ranchers who
have already been doing good conservation.
Again, from what I have heard from all of you this figure
is way too low. Do you all agree on that?
Mr. Cox. Yes.
Senator Harkin. It has to be raised. I think most of you
feel strongly that it should be done on a voluntary basis, that
it ought to involve the technical help and support of the
Conservation Service to do that.
I asked one question yesterday. I still don't know them
answer to this. Since you have been there, maybe you can help
answer this, Paul. The Conservation Service does all the
technical help and stuff and the Farm Service Agency pays the
bills.
I have gotten some communication in Iowa where they have
not been working closely together. I have to question why that
is, why shouldn't the Conservation Service do the technical
thing and just pay the bills? Why do we have that split?
Mr. Johnson. This began in the 1930s. I am not sure I want
to go there, other than to suggest that I think that the
infrastructure that we have out there, Extension, Research,
Farm Services, Rural Development, NRCS, all have important
roles to play.
I think where we have suffered is we have pitted one
against the other over the years. I think what would do more
good for this country in the delivery of these services is to
probably better define what each does and certainly the Farm
Services does provide a lot of administrative work.
But unfortunately, NRCS, from my perspective, isn't able to
make all the conservation decisions. I think that you need to
help define their positions, but you also need to remind them
that they do good work. We really do run each other down, and I
think that that is terrible. I think we ought to be able to
work through it.
Senator Harkin. Well, Mr. Chairman, I don't know, the more
I'm getting into this the more I am thinking we really ought to
take a look at those structures out there, the old structures
that have been build up over the years and see if maybe there
ought to be some changes in any of these services.
Mr. Johnson. One thing I would like to caution you on as
you do this, the Natural Resources Conservation Service is an
agency of professional people and I hope that that doesn't get
compromised as you work through this.
You need to have independent technical assistance and
opinion out there. It should not be compromised with a more
political approach from administration to administration.
Senator Harkin. No. That is a legitimate concern and I
don't want that to happen either.
Mr. Rudgers. Also, Senator, States have stepped up and
provided the opportunity to create a table where both Federal
and State agencies can come around and work on these issues
effectively. That has effectively brought Federal partners
together for conversation and for action, which has been
effective.
So the perception that things are not quite getting along
as well as they should might not be universal. I can offer my
own State as an example. We have both a State technical
committee with active participation of those Federal agencies
and State agencies and also our State Soil and Water
Conservation Committee and the AEM Steering Committee under
that which provide the opportunity for those folks to gather
around the table and then agree on objectives and act on those
objectives effectively, using both State and Federal dollars.
It is an excellent model and it helps solve some of the
concerns that you have which I think are legitimate.
Senator Harkin. Thank you all. Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Harkin. I would
just follow through once again with a more parochial note.
Yesterday the NRCS Director in Indiana drew my attention
and this is apparently true throughout the nation-that as they
took a look at NRCS staffing levels in our State of Indiana,
that in 1987 there was the equivalent then of 330 work-year
persons. This is now down to somewhere around 240 in the year
2000.
Their suggestion is, given the mandates of the last farm
bill that we passed, that they needed 290. So even with the
economies that might have occurred, there would appear to be a
20 percent plus shortage in terms of the people giving the
technical assistance to farmers in the field, with regard to
EQIP or these other programs.
Senator Harkin. Is this just Indiana?
The Chairman. Yes, this is just Indiana's situation. I
would gather probably NRCS could provide similar charts for
every other State, but perhaps because of the urgency of these
hearings and the fact that Senator Harkin and I were going to
chair on yesterday, they provided this.
But it was very interesting and it is instructive of the
point you are making. These are technical people. They point
out about 83 percent of their entire workforce are technically
gifted people in these fields.
So even as we have important ideas about how the
stewardship should occur and the Federal contribution to this,
we have to be thinking through in the field who is available.
We have armed services objectives, people who can use smart
weapons, and recruiting these people is sometimes difficult,
and particularly if there is not the budget provided.
I would just reassure you at least that we are attempting
to factor these things into our own consideration and going to
school as we listen to you.
We thank all four of you for your testimony, for coming
today and staying with us throughout this period.
Mr. Johnson. Thank you, Mr. Chairman.
The Chairman. I would like now to call on our second panel.
That will include Mr. Bob Stallman, the President of the
American Farm Bureau Federation, Washington, DC.; Mr. Dan
Specht, Sustainable Agriculture Coalition of Washington, DC.;
Mr. Tom Buis, Executive Director of the National Farmers Union
in Washington; and Mr. Rollin D. Sparrowe, President of the
Wildlife Management Institute of Washington, DC.; and Mr.
Gerald Cohn, Southeast Regional Director of the American
Farmland Trust, Washington, DC.
Well, I will ask you gentlemen to testify in the order in
which we have introduced you. It is always a pleasure to have
the President of the American Farm Bureau Federation with us.
We thank you for coming. Would you please commence your
testimony,
Mr. Stallman.
STATEMENT OF BOB STALLMAN, PRESIDENT, AMERICAN FARM BUREAU
FEDERATION, WASHINGTON, DC
Mr. Stallman. Thank you, Mr. Chairman, Senator Harkin. It
is a pleasure to appear before this committee to allow AFBF to
present our views. I am a rice and cattle producer from
Columbus, Texas.
Increased regulatory costs on all levels-Federal, State and
local-are placing a heavy burden on individual farmers and
ranchers as well as distorting the traditional structure of our
industry.
The unintended consequence is the inability of small and
medium-sized family farms to compete in a highly charged
regulatory environment. The Farm Bureau believes there is a
need for new environmental policy framework.
We need to move beyond the current debate over whether the
public has the right to mandate features and/or farming
practices in the rural landscape. If a voluntary incentive is
offered for a desired environmental outcome, farmers will
overwhelm America with improved soil, water and air quality and
wildlife habitats.
In order for a conservation incentive program to work well,
public policy must recognize the inherent limitations that
command and control regulations have in attaining desired
public benefits. Efficient public policy is one where the thing
demanded by society is the thing that is being produced.
Farmers and ranchers can produce and market more than
traditional agricultural commodities. We can also produce and
market environmental benefits. Under this concept agriculture
and the Government program must come together to create an
alternative market for environmental improvements or amenities
that the public desires.
Specifically, Farm Bureau policy supports expanded
incentives to encourage voluntary improvements in the
environment, expansion of the funding baseline in the
commodity, specialty crops, livestock, conservation, research,
trade and risk management titles; voluntary participation in a
direct payment program that would comply with the WTO green box
requirements and providing willing producers with additional
voluntary incentives for adopting and continuing conservation
practices.
Our vision is to capture the opportunity and efficiencies
of providing producers with additional conservation incentives.
Specifically, I would like to highlight three programs for
which we would like to see new funding.
First, the Farm Bureau supports a limited increase in the
amount of acreage eligible to be enrolled in the CRP with new
acreage targeted toward buffer strips, filer strips, wetlands,
or grass waterways.
Second, the current Environmental Quality Incentives
Program does not provide livestock and crop producers the
assistance needed to meet current and emerging regulatory
requirements. EQIP must be reformed and funding increased.
We support the following reforms to EQIP: No. 1,
elimination of language that prevents large livestock
operations from being eligible for cost share. No. 2, broader
third-party technical assistance authority, which would allow
farmers to hire consultants to provide technical assistance.
No. 3, elimination of priority areas, which would allow all
producers, regardless of location, to participate in the
program. No. 4, simplification of program participation.
Finally, I wish to express our support for a new voluntary
environmental program that would provide producers with
additional conservation options. This program would provide a
guaranteed payment to participants who implement a voluntary
management plan to provide specific public benefits by creating
and maintaining environmental practices.
The management plan should be a flexible contract, designed
and tailored by the participant to meet his or her goals and
objectives while also achieving the goals of the program.
We support an increase in the budget baseline of $3 billion
annually for the three conservation initiatives I have
outlined.
Two other conservation programs supported by the Farm
Bureau are the Farm Land Protection Program and the Grazing
Lands Conservation Initiative. The Farm Bureau supports funding
for the Farmland Protection Program.
There have been attempts in recent years to make nonprofit
organizations eligible for this funding. The Farm Bureau would
oppose this change.
Additionally, we oppose the imposition of a farm management
plan on the property. The intent of the Farmland Protection
Program is to avoid development pressures, not dictate farming
practices.
The Grazing Land Conservation Initiative is a program
providing additional technical assistance that are NRCS for
range and pasture management. We support the continuation of
this program.
One last item before concluding: Confidentiality of USDA
information has become an increasing concern and priority for
farmers and ranchers. We have seen attempts by other government
agencies to secure NRCS and NASS data for regulatory purposes.
There have also been attempts by non-governmental
organizations to secure farm and ranch data from FSA and APHIS.
The Farm Bureau strongly supports establishment of statutory
authority that protects the confidentiality of all data
collected by USDA on individual farms and ranches.
Thank you for the opportunity to be here today. I will be
ready for questions when the time comes.
[The prepared statement of Mr. Stallman can be found in the
appendix on page 185.]
The Chairman. Thank you, Mr. Stallman.
Mr. Specht.
STATEMENT OF DAN SPECHT, SUSTAINABLE AGRICULTURE COALITION,
WASHINGTON, DC
Mr. Specht. Good morning. Thank you for the opportunity to
testify. My name is Dan Specht and I am a fourth generation
farmer from northeastern Iowa. I am testifying today on behalf
of the Sustainable Agriculture Coalition. I started farming in
1971 with my parents and three of my brothers. I have been
farming on my own since the mid-1900s.
I now raise crops and livestock on about 700 acres. Most of
my land is considered highly erodible. My farm is just outside
the Big Springs Study Area. Many of you may have heard about
it.
This study was started as part of Iowa's Ground Water
Protection Act and it studied the movement of nitrates into
surface and ground water.
Although many of my friends and neighbors in recent years
have been forced to earn off-farm income and are no longer
raising livestock, I am actually very optimistic about the
future of agriculture. I am optimistic because I have been able
to produce crops and livestock using low-cost methods that are
profitable and environmentally sound.
I have been able to market those products with preserved
identity through farmer-owned organic marketing cooperatives.
Besides raising organic soybeans, I have also converted a
large part of my farm to a system of grass-based beef
production called ``management intensive rotational grazing.''
Despite my optimism, I am distressed at the barriers
current farm policy put in front of farmers like myself who are
trying to adopt methods that are more environmentally sound and
economically viable.
I think the existing commodity programs have three fatal
flaws. First, if you were a farmer like myself who was making
hay, grass and small grains a big part of your rotation during
the base-building years of the 1980s, you are not eligible for
AMTA payments on those acres.
The more land you planted into row crops then, the more
money you qualify for now. Because of my diversity, I am only
receiving AMTA payments on a tiny fraction of a corn base out
of the 500 acres that I own.
Neighbors of mine who farm similar land qualify for AMTA
payments on nearly 100 percent of their crop acres because they
have a high corn base.
Doubling AMTA payments, which has happened in the last
couple of year, has only doubled this inequity. Now, the system
of LDP, Loan Deficiency Payments, is adding insult to injury.
Unlike the AMTA, which has prospective planting
flexibility, LDP monies flow only to the program crops,
creating further barriers to resource conservation and
environmental improvement. This bias puts diversified,
conservation-oriented farmers at a competitive disadvantage in
all kinds of situations, including land markets.
How would you like to be put in a position like I have been
in and have to explain to a landlord that because I was farming
his farm in a soil-conserving rotation his farm isn't worth as
much today because he has a small corn base.
The second fatal flaw is that the program allows actual
cash prices for the crops to fall below the cost of production.
We now have the worst of two worlds. We have no limits on
production, coupled with what amounts to direct payments as
LDPs to increase production even more.
This gives a competitive edge to industrial livestock
producers who can buy the raw material, feed, at less than the
cost of production, while a farmer feeder has to have the real
production cost paid.
The third fatal flaw in this program is the lack of
effective targeting to family farm income or any effective
payment limitation. The current program is ``the sky is the
limit.'' The program exacerbates the first two problems. It
provides a public subsidy for land concentration and reduces
diversity and continues environmental problems.
These flaws mean we are losing the potential to capture
many of these social benefits that diverse crop and livestock
farms can provide. I believe that the first thing Congress
needs to do in addressing conservation in the Farm Bill is to
take a hard look at farm programs and take serious steps
towards making them consistent with widely shared public
support for good stewardship. Incentives for over-production
and land consolidation need to be reduced. Barriers to
diversification need to be removed and real requirements for
basic conservation need to be reinvigorated.
I have witnessed some of these resource and environmental
benefits firsthand on my own operation and I would welcome any
members of the committee to come out and see my farm with its
improved wildlife habitat, erosion control, and water quality.
Pheasant season is open in November. Deer season is December.
Turkeys are April and May.
I am always looking for an excuse to go fishing. I have the
Mississippi River right next door. There are a lot of trout
streams and farm pond in northeast Iowa that you would be
welcome to visit.
But I would like to share with you what the scientific
community is finding about sustainable farming systems that I
am using. One of these systems is management intensive
rotational grazing.
The Minnesota Cooperative Fish and Wildlife Unit has found
that rotational grazing significantly reduces the amount of
sediment flowing into a waterway. In one instance, a single
storm dumped 10 tons per acre of soil off cropland but only 4
pounds per acre from the adjacent rotationally grazed paddocks.
Researchers have also found that life in the stream
degraded by overgrazing and sedimentation starts to recover as
it flows through a rotationally grazed area.
The University of Vermont has found that a grass-based
operation burns 24 percent less fuel than a row-crop farm.
University of Wisconsin researchers recorded more than
twice the number of nesting grassland songbirds in a
rotationally grazed paddock when compared to the same acreage
of a continuously grazed pasture and almost no nesting in
adjacent cropland.
The Chairman. Mr. Specht, let me just ask if you would
summarize a little bit more. That would be appreciated because
in fairness to all of our witnesses, I suggested at the
beginning, perhaps before you got here, about a five minute
summary. If you could do that I would appreciate it.
Mr. Specht. Well, this testimony is in my written remarks.
The Chairman. Yes, and it will be made completely a part of
our record.
Mr. Specht. One thing I do want to bring out today are the
health benefits that have been recently discovered by ARS
researchers and researchers at the University of Wisconsin.
Worldwide studies have shown where cows who graze exclusively
have dramatically higher levels of conjugated linoleic acid,
CLA, in their milk. Laboratory studies done throughout the
world on CLA in both meat and milk have shown it can help
prevent breast cancer and other malignant growths. It also is a
very heart-healthy substance.
The fascinating thing about CLA is that what an animal eats
determines what the CLA content is in the product. CLA in meat
and milk from animals getting their diet from grazing is five
times more concentrated than milk from confined and grain fed
animals.
I wanted to make sure that everybody in the room heard that
fact because it is very new scientific information.
The Chairman. I appreciate your highlighting that as well
as the other elements of your testimony. It was important.
I make the point for all of the panel that all of your
statements will be published in full in the record.
[The prepared statement of Mr. Specht can be found in the
appendix on page 196.]
Mr. Buis.
STATEMENT OF TOM BUIS, EXECUTIVE DIRECTOR, NATIONAL FARMERS
UNION, WASHINGTON, DC
Mr. Buis. Thank you, Chairman Lugar, Senator Harkin, and
Senator Nelson. It is an honor to be here today to share with
the Committee the National Farmers Union's positions and
recommendations on current conservation programs and a couple
of new initiatives.
The conservation programs currently authorized under the
FAIR Act have generally been very sound programs. They have
served to conserve our soil resources, enhance our wildlife and
improve the quality of both air and water through incentives
and technical assistance.
However, we do believe there is room for improvement in two
general areas. First, it is important that the level of funding
be adequate to ensure the long-term success of these
initiatives. Second, a key priority of these programs should be
to target assistance to family-sized farm and ranch operations.
We believe such an approach will serve to promote the
broadest possible development in application of conservation
measures while reducing the likelihood these programs encourage
further concentration in agriculture.
After reviewing the current programs, we would make the
following observations and suggestions. The Conservation
Reserve Program has been the most successful conservation
program in our nation's history, thanks in large measure to
your foresight in introducing that legislation 15 or 16 years
ago and the determination of this committee and other
committees in Congress to keep it going.
It has significantly reduced soil erosion, dramatically
improved wildlife habitat by idling highly erodible and
environmentally sensitive land. We thank you for that.
We also support in the CRP Program raising the cap on total
enrollment to at least 40 million acres, reducing the emphasis
on whole farm enrollment, ensuring compensation rates are tied
to local rental rates, reviewing and enforcing the aggregate
county entry levels, reviewing the requirements and benefits of
planting expensive and often unneeded five-way seed mixtures as
cover crops, and for re-enrolling existing CRP acreage we think
a required field inspection should be conducted to determine
whether the current cover crop contains desired multiple plant
species, not just based upon what was planted originally.
We also feel that allowing whole field enrollment is a wise
way to go, as well as authorizing enrollment of farmable
wetlands similar to a pilot program that is about to be
implemented in South Dakota.
For the Wetlands Reserve Program, we recommend removing the
cumulative acreage cap and providing such funds necessary to
address the current and future demand.
We also recommend additional funding and support for the
EQIP Program, Conservation and Technical Assistance Program,
Private Grazing Land Initiative, Wildlife Habitat Incentives
Program and the Farmland Protection Program.
There is tremendous demand out there for these programs and
we would encourage their continuation.
In addition, we think there are some improvements that need
to be made and some programs adopted. First among these is the
Conservation Security Act--and I want to commend Senator Harkin
for the outstanding work he has done on that proposal. We think
it is a great proposal that would provide incentivepayments to
producers for the application of appropriate conservation
measures on land that is currently and likely to remain in
production.
The Conservation Security Act, I think, is designed to
target those payments to family farmers and ranchers who are
engaged in production agriculture in a way that is consistent
both with our obligations to the WTO while encouraging
increased levels of environmental stewardship.
We think this framework is a way to reward both those who
have undertaken the establishment of conservation practices in
the past and those who implement future activities. We highly
recommend the committee take that into consideration.
A second new initiative that we have been talking about is
the Soil Rehabilitation Program. In many parts of the country
there are significant areas of cropland that have been
decimated by adverse weather, disease and/or pests. The
incidence of these problems has reduced the productive capacity
of the land and poses an ongoing threat to the producers in the
short and intermediate term.
The program would provide both technical and economic
assistance to family farmers so that they may undertake the
needed stewardship activities to restore their resources to
their historic level of productivity.
For example, in the Northern Plains the disease fusarium
head blight, also known as ``scab,'' has reduced the yield and
quality potential of wheat, durum and barley production
significantly in recent years. Due to the accumulation of the
disease inoculum in the soil, lack of resistant grain varieties
and agronomic limitations on alternative crop production,
producers must either assume the excessive production risk of
discontinue production of those traditional crops.
We think either scenario is beyond the economic capacity of
these producers and we would encourage the Committee to adopt
it.
Briefly, we also support appropriate incentives, and maybe
this can be worked into the Conservation Security Act
provisions of Senator Harkin for support for carbon
sequestration efforts at the farm and where farmers cannot only
benefit but be able to have a market for carbon sequestration
credits that is open to both producers and cooperatives.
Mr. Chairman, I thank you for the opportunity. I will be
glad to answer any questions.
The Chairman. Thank you, Mr. Buis. It is always good to
have testimony from the National Farmers Union. Thank you for
coming this morning.
[The prepared statement of Mr. Buis can be found in the
appendix on page 205.]
Mr. Sparrowe.
STATEMENT OF ROLLIN D. SPARROWE, PRESIDENT, WILDLIFE MANAGEMENT
INSTITUTE, WASHINGTON, DC
Mr. Sparrowe. Thank you, Mr. Chairman. I really appreciate
being here to speak on behalf of a very large array of wildlife
interests who have become increasingly involved in farm
programs over the last couple of decades.
We appreciate the great progress made during the past few
years with wildlife as a co-equal status with soil and water
conservation.
We think there have been some wonderful opportunities that
we are doing our best to take advantage of. You have heard much
about the benefits from the hearing yesterday and some of the
speakers today, so I won't repeat the specifics at this point.
We have some in our testimony about gains for such things as
waterfowl and game birds and so on.
What I would like to talk about is what we in the wildlife
community have been up to to try to answer a fundamental
question we anticipated we would be asked, and that is: how
much is enough and what does it do for wildlife and what are
the broad benefits?
We think a lot of these programs have returned excellent
benefits to farmers and they help make the continuing case for
conservation programs to be a big part of agricultural
expenditures.
We have conducted workshops bringing wildlife and
agricultural interests together to address this issue and talk
about problems and implementation. We have maintained an e-mail
network with farm bill active people across the country, both
in the agricultural sector, private sector, and in the State
fish and wildlife agencies.
This has been very helpful in sorting out issues related to
implementation. It hasn't solved them all. But it is a good
forum to have. Our big energy has gone into producing the
document that we attached to our testimony which is the ``How
Much is Enough for 2002'' document.
One of the most interesting things about this is on the
opening page under ``acknowledgements,'' there are 60 agencies
and organizations that contributed to both the input and the
support for putting this together.
This is a demonstration of the interest and the willingness
of wildlife organizations and agricultural organizations to
work together. Based on these assessments, there are lots of
details presented on a regional basis. That is one of the
messages that comes out of this assessment, that there are
differences in what needs to happen on the land, both for
farmers, for crops, and for wildlife in California versus North
Dakota versus Georgia.
We think there is an increasing need to take that into
account. The examples of specific success are many. But there
are some areas of the country that have not benefited as much.
The northeast and the southeast and some parts of the west have
seen this as a farm program, a wildlife program for the upper
Midwest.
There is great interest in expanding the reach to deal with
some real problems on the land that farm activities affect in
other parts of the country.
I want to call your attention to an NRCS publication, a
comprehensive review of farm bill contributions to wildlife
conservation, which, in response to the demand to work
together, Pete Heard of the Wildlife Habitat Management
Institute led with some of our wildlife colleagues.
They put together a really excellent compendium of what the
science base is for what we now know some of those benefits
are.
We are engaged in a very important coalition-building
effort at this point, looking at such data on evaluating
program impact, working toward coalitions that, at the State
level, bring farm operators, wildlife biologists, agribusiness
representatives and others together, some folks who don't talk
to each other in all circumstances.
In some State we have seen great success and great advances
in people sitting down together, particularly States where the
State technical committee has flowered and pulled people in to
work together. We think those coalitions which we now have
going on in 20 States can be a very important contributing
factor.
We have a few recommendations that are specific. The
technical assistance area has been of deep concern to us. The
wildlife community has worked with three successive chiefs of
NRCS, unsuccessfully, to make our case that while downsizing
and other things have been going on, that without technical
assistance at the field level, these programs can't be
delivered. I think you have heard that from several other
speakers.
Our radical proposal is that there is one alternative to
more Federal staffing and that is for some Federal funding to
be made available directly to the State wildlife agencies and
other agencies within the States for that matter and even to
non-government organizations to help with this technical
assistance.
One of the big discussion points a few minutes ago here was
on what the States are contributing. Actually, States and NGOs
have put up an awful lot in the technical assistance arena. We
would be pleased to work with you to try to document some of
that.
We have strong feelings that agricultural support payments
should be linked to conservation compliance. We certainly
endorse as much of that being voluntary as is possible, but
compliance is a necessary part.
We think there needs to be flexibility in implementation of
farm programs, not only on a regional basis, but even in the
traditional agricultural arenas. Conservation tillage, as an
example, was designed and did a good job to retard soil erosion
from wind and water. But it also provides great wildlife
benefits by leaving some cover on the land.
We need to look at grazing and cropping and other things in
collaboration with some additional research to find those
things we can do with existing agriculture that can also lead
to additional wildlife benefits.
Finally, one program we think should be thought about is a
native grassland easement program. This would provide for needs
in many areas of the country, particularly the west. We are
ready to work with you. We think we have a good documentation
of what some of the benefits and needs for the future are. We
thank you for this opportunity.
[The prepared statement of Mr. Sparrowe can be found in the
appendix on page 209.]
The Chairman. Thank you very much, Mr. Sparrowe, for coming
this morning.
Our next witness is Mr. Gerald Cohn, the Director of the
Southeast Region of the American Farmland Trust. We appreciate
your coming.
Please testify.
STATEMENT OF GERALD COHN, SOUTHEAST REGIONAL DIRECTOR, AMERICAN
FARMLAND TRUST
Mr. Cohn. Thank you very much. The American Farmland Trust
appreciates the opportunity to provide your committee with our
views on how the Conservation Security Act will help farmers
and ranchers improve their bottom line and meet the increasing
public expectation of agriculture to produce environmental
benefits as well as food and fiber.
We also thank the Committee for recognizing the need for a
comprehensive farm bill. You will need all the programs,
including research, conservation, and forestry to help farmers
meet today's challenges.
I am the Southeast Regional Director for AFT. With my
family, I run a small, diversified produce and livestock farm
in Snow Camp, North Carolina. We have enrolled pieces of our
farm in the CRP and CREP programs. They are a valuable
management tool for profitability and to demonstrate the
multiple benefits of farmland to our community.
American Farmland Trust is a national nonprofit
organization with 50,000 members, working to stop the loss of
productive farmland and to promote farming practices that lead
to a healthy environment.
When most people think about farmland protection they think
it is just about protecting the land. It is not. It is also
about protecting the community and protecting the farmer. That
is why the Conservation Security Act is so important to
farmers, ranchers and agricultural communities around the
country who face increasing challenges from urban sprawl,
tightening environmental standards, and global and local food
markets.
As Congress starts its discussion of the next farm bill,
two key issues from AFT's farm bill meetings around the
country. Farmers and ranchers want to improve the conservation
practices and the public expects them to do it.
Unfortunately, the current menu of conservation programs
doesn't come anywhere close to meeting the demand from farmers,
ranchers or voters.
I would like to enter into the record a letter to the
Senate Budget Committee from over 30 organizations that
highlights the number of farmers and ranchers seeking Federal
assistance to meet the Nation's pressing environmental
challenges, but are turned away.
Looking at the backlog of farmers and ranchers waiting to
participate in conservation programs, Federal support needs to
at least double in the next farm bill.
Although the demand for conservation programs has climbed
significantly since the 1996 Farm bill, funding for these
programs has dropped from 30 percent of agricultural spending
to just eight percent.
How can we continue to turn away farmers and ranchers who
want to do the right thing? I think the public has begun to
ask, how can we spend $32 billion a year on farm programs and
not address this overwhelming need?
These programs still miss a large sector of American
agriculture that is producing the majority of agricultural
value in the United States and face some of the most
significant environmental challenges. I am referring to those
farmers and ranchers in urban influence areas who face the same
price and supply challenges as traditional commodity
agriculture, but also face the many problems brought by urban
development, nuisance suits, trespassers, transportation
nightmares and escalating land values.
In addition, the pressure on these producers to clean up
the environment is greater than in more remote areas. These
farmers receive little to no Federal assistance and yet are the
farmers and ranchers most of us living in urban areas think of
when agriculture is mentioned.
The Conservation Security Act is one big step toward
creating a safety net for these farmers and ranchers. Let me
give you a couple examples of just a few of the challenges
facing farmers in my region and how the Conservation Security
Act will help farmers meet them.
The first challenge faced in the southeast is rapid growth.
USA TODAY recently included four southeast cities in the top
five most sprawling metro areas. Our best farmland is being
consumed by this tidal wave of sprawl.
How do we keep these lands and farms and not become housing
developments? The first step is to protect the land through the
purchase of development rights. The only Federal program
supporting this, FPP, is oversubscribed by 600 percent.
Also, make it economically worthwhile to keep producing.
That means paying farmers not just for the food and fiber they
produce, but also the environmental benefits they provide.
The Conservation Security Act would do that by compensating
growers, not just sharing the cost for implementing and
maintaining conservation practices.
The next biggest threat to agriculture in my region is the
changing in the tobacco and peanut industries. As quota for
these commodities is being reduced, farmers are either getting
out of farming altogether, or struggling to find profitable
alternatives to replace their lost income.
Successful diversification requires risk and time and the
Conservation Security Act would provide an income safety net to
help farmers through this transition period and promote green
practices that potentially could open new markets for their
production.
The CSA would also bring more regional equity to farm
programs simply because every farmer would be eligible. Right
now States in the Southeast receive only 5 cents in Federal
farm assistance for every dollar they produce, compared to some
States receiving more than 25 cents per dollar.
We need to start focusing farm policy on those farmers and
ranchers who produce the greatest environmental and economic
benefit to the taxpayer. The CSA is a good start to finding
that balance.
By giving farmers and ranchers the tools and financial
assistance to meet their environmental challenges, we can build
the public support necessary to make sure the next generation
of farmers doesn't have to ask if their children will be able
to carry on the proud farming legacy.
Thank you.
[The prepared statement of Mr. Cohn can be found in the
appendix on page 219.]
The Chairman. Thank you very much, Mr. Cohn.
Let me ask a question of you, Mr. Specht, because I was
intrigued by your analysis of the AMTA payments that have been
made the last twoyears. Then you pointed out LDP payments on
top of that, I think you said were sort of a double insult.
Given the particular choices you have made in how to manage
your farm, and in fairness, we have had a debate here in the
committee and my colleague, Senator Harkin, has raised some of
those issues.
I voted in favor of the AMTA payment route because
pragmatically, in an attempt to get income to American farmers
we had lists, we were able to use computers. We were able to
cut checks. Money got to farmers. They paid country banks and
they stayed in business.
I think all this is well known, although our oilseed
payments that sort of came along in a way with the second round
of this are now just being distributed. We got ours in the last
10 days or so and I gather that is probably true of many people
who are soybean farmers after a much more laborious process,
sort of finding out who is there and how many bushels and so
forth.
Others who were affected by the Farm bill payments last
year, in an attempt to help in those emergencies are still
receiving payments or will at some point, I hope during
calendar 2001, even as we contemplate the future.
So this is sort of the nature of this type of business.
However, on my farm we have 200 acres now devoted to a timber
improvement stand. We planted 60 acres of walnuts, oaks, and
cherry, what have you.
The thought occurs to me as I listen to you that I am not
getting an AMTA payment on these acres. One option was to plant
corn on those acres, at least pragmatically the yields, given
the soil types, the yields would not have been as good as they
are in my bottomland and various other places.
So that was part of the consideration and it is always, as
we try to manage our land successfully. But another part of the
consideration was my grandchildren like trees and we now have
12 herd of deer in there and lots of other things that get to
the wildlife and other considerations of the joy of having such
a property.
I am not sure how you evaluate all of this. I have wrestled
with this a good bit as have Senator Harkin and other members
of the Committee, both in terms of the safety net for income,
yet we had the testimony which I cited before this morning that
just 36 percent of farmers are receiving these checks, these
payments, which means 64 percent are not.
Even after you think of the structure of agriculture which
we recited today, all these overlays are very confusing to the
members of this committee as to how we ought to proceed. I
mention this because I sort of ask of you, is your testimony
essentially that we ought to proceed by de-emphasizing in the
next farm bill the AMTA route and try to think of some new
formula that is more conservation based. That is a pretty broad
category, but thinking through various practices that have been
suggested today, various land conservation management plans,
and just pragmatically, how many people will be required to
evaluate all this or can you or your organizations
collectively, not today, but in the months to come be helpful
in trying to think through if you were philosophically to move
in this direction, how would we do it?
I will just ask you for a short comment rather than off the
top of your head reciting legislative language we should adopt.
This is sort of a long lead up to a philosophical inquiry.
Mr. Specht. No. I think the original goal of the last farm
bill to try to move toward market-oriented goals is a worthy
goal, reducing the emphasis on producing for the program. It
would be very logical, if you want to support farmers, to do it
with a conservation stewardship type of a payment. That would
make a great deal of sense from my point of view.
I think the consumer would get more out of it and it would
not be dictating a type, like if you live in southwest
Wisconsin and you have very steep, hilly ground that happens to
also be very productive ground, people who have been growing
strip cropping with alfalfa and small grains and feeding their
cows alfalfa and small grains are now currently being penalized
because they were doing it that way versus growing corn on
those same hills. So I don't think commodity-type legislation
should be dictating what farmers grow. They shouldn't be
growing crops for a commodity program. They should be growing
crops to make money in the market.
The Chairman. Mr. Sparrowe, let me ask a different type of
question. You have suggested that State game and fish agencies
might take on more responsibility in implementing some of the
conservation programs. Perhaps. But this strikes me just from
my own experience in my own State that it would create some
anxiety level on the part of farmers.
I am not certain how many of these folks they want
wandering around the farm inspecting the situation and
sometimes we get into a kind of adversary proceeding over this.
How can all these people be friends or do you have some
idea from your experience of how this might work out?
Mr. Sparrowe. Obviously, personal behavior and sensitivity
to the needs of people working on the land is something that a
biologist has to have. Otherwise, they are not going to be
successful.
We have some notable successes. We worked to help Kansas
and NRCS collaborate on this in the early stages of the Farm
Act. It worked very well. I think six or eight employees of the
State were supported to quickly advance the cause of some of
this. A State like Missouri which has a larger, well-funded
program of its own has recently decided to co-locate its
biologists who work with private lands issues with NRCS
offices. So people are working hand in glove, day by day.
In many cases, starting back with Chief Richards, we noted
that while there is a lot of biological expertise in NRCS in
the field, the new people being hired were generally not very
heavy on biologists. They were heavy on other kinds of skills.
So not only is it numbers, it is the focus that has been
placed on this. We are just suggesting strong attention to
this.
Another notable success has been Ducks Unlimited, which has
very widespread private land programs. They have been providing
extensive, both cost-sharing and technical assistance on the
ground.
Pheasants Forever in the upper Midwest has done this and
other organizations now as different geographic regions of the
country kind of come awake to the opportunities are trying to
weigh in.
The Chairman. It is interesting that you mentioned Ducks
Unlimited and Pheasants Forever. They have been coming into our
hearings with enthusiasm for these programs. We are grateful
that there has been this marriage of a good number of Americans
and a different constituency.
Senator Harkin.
Senator Harkin. Thank you very much. I have just a couple
of things. I will try to be quick here.
Mr. Buis, on the carbon sequestration that you mentioned,
we already have that in the CSA bill. I would ask you and any
others who are interested in carbon sequestration to take a
look at that. Any suggestions or advice you have on how we
might modify it, change it, make it better, we need that input.
Mr. Buis. We would be glad to. Also, you might want to look
at the soil rehabilitation idea that we had where you had
diseased lands that really need to be idled to get beyond the
scab infestation and some other challenges we face.
I don't know if that could work in that program as well.
Senator Harkin. I don't see why not. On the whole issue of
carbon sequestration, again, I ask all of you to be thinking
about that. Any further input you have on that, we would sure
appreciate it.
Mr. Cohn, I want to thank you for your strong support of
CSA. I appreciate that very much. Again, I ask for any advice
or suggestions you have. Two things you mentioned that I think
we have not kind of focused very much on and that is this whole
issue of urban sprawl.
The same is happening, I am sure, in your State and mine
and everywhere else. We are losing a lot of this good land to
urban sprawl. I don't know exactly how we stop some of it, but
you had a suggestion that maybe in the CSA that kind of the
payments for conservation and enhancement might help keep some
of this land in farmland and in wildlife.
Again, I want to get a better idea of how that might work.
That is something that we have not really focused on but it
might be a good thing to focus on.
So if you have some suggestions on how we might wrap that
into the bill itself, I don't know. It seems to me then you get
into the thing about people bidding up the price of land and
that type of thing. I am concerned about that.
Mr. Cohn. I think, you know, the key step to keeping
farmland in farmland is to make it profitable to be a farmer
and having a range of options available to the farmer where he
can respond to changes in the marketplace and changes in
environmental conditions is the best opportunity farmers have
in order to compete on the urban edge.
Another piece I would add, if I can go back to your
question of the previous panel about the State and local match,
the Federal Farmland Protection Program in the first $35
million that it was authorized for that program leveraged $230
million of State and local funds.
So it really evidenced very well the commitment on the
local level to protecting farmland.
Senator Harkin. Thanks for those figures. The other thing
is about the tobacco farmers. I think that is another thing
that we are going to have to look upon there and the way we
transition them out.
We haven't really focused on that. While I may have strong
feelings about people not smoking, I don't think the tobacco
farmers can be held to blame for that, for crying out loud.
They are going to have to transition, so this may be another
good element of a conservation-based payment system to get
support out to them in a way they can transition to some other
type of agriculture.
Dan, you mentioned, for example, in your testimony--I was
hoping you would mention it verbally but you didn't get to it.
But you said one important improvement under the Conservation
Security Program that could be made would be to direct USDA to
take all necessary steps to ensure that organic farming plans
developed under the new National Organic Program were going to
also meet the terms of the Conservation Security Program.
I underline that and asterisk that because I think you are
right. I don't know that we have focused on that too much.
Since there is more and more demand for organic foods, we see
it in our farmers' markets. We see it in Fresh Fields, the
stores that are going up all over that can't even meet the
demand of people coming into them. So perhaps we need some
focus on organic farming in a conservation type of a bill.
Again, if any of you have any thoughts on that, I would
appreciate it. Dan, do you have any thoughts on that at all?
Mr. Specht. Well, I think a lot of people who haven't had
much experience with organic farming don't realize that it does
take some long-range planning and if you are going to be
producing from the soil, you have to be building your soil to
get production from an organic system.
So a lot of the soil conservation and soil improvement type
goals are naturally a part of trying to raise healthy, organic
crops. You are trying to build your soils and soil conservation
is a part of most of the farmers I know.
Senator Harkin. I guess I am thinking out loud here, but,
you know, if you have an incentive-based program which is
voluntary, which is the way we are moving, and if people want
to voluntarily engage in organic farming, that is fine.
Perhaps we ought to have some focus in a bill. I guess I am
asking, do you think there ought to be some added incentives
for people to engage in organic farming? Obviously, it costs
more money, I think, in many cases than it does for non-organic
farming.
Mr. Specht. Well, I think we have to be careful because so
far it has been a market-driven, demand-driven business and I
think most of the people who are currently producing from
organic markets would hate to see the organic marketplace
become another commodity-type business where government
incentives create over-supply.
So I think you have to be careful. There would be room.
Thinking out loud again, I can see there is a requirement for
organic production to be buffered by a 25- to 30-foot strip
from chemical applications. Possibly organic buffer strips, if
they meet other conservation requirements, could be included in
a buffer initiative along fence rows.
On either side of the fence, I would be happier if my
organic farm could produce up to the fence and I could talk my
neighbor into putting the buffer on his side of the fence. It
would be nice to see them both qualify.
Senator Harkin. Mr. Sparrowe, you think CRP ought to be
increased to 45 million acres. Does your organization have
other data on the value of CRP's improvements to wildlife,
viewing and pheasant hunting? You estimated a $704 million a
year. You cite a study here.
If you have any other data on that, I would like to have
it. I would appreciate it if we could see that because it has
been hard to get a handle on what has been the economic impact
of using conservation land for hunting purposes, that type of
thing.
Mr. Sparrowe. We will look at that.
Senator Harkin. I am like you, I am a hunter. I like it,
but I don't know how much economic benefit it has provided. As
bad a shot as I am, it has probably added a lot.
Mr. Stallman, again, I thank you for your testimony. It
seems that the Farm Bureau, is basically in favor of an
incentive-based voluntary approach to a conservation program
that would be a part of the new farm bill, at least that is
what I understood anyway.
Mr. Stallman. Yes, Senator, that is correct. That is one
tool in our whole toolbox of farm policy that I presume we will
be laying out before this committee at some point.
Senator Harkin. From your standpoint, from Texas, you say
you are rice and something else?
Mr. Stallman. Yes, Sir, rice and cattle.
Senator Harkin. Again, we have to think about this
conservation thing in a broad aspect, from the fruit and
vegetable growers, the cherry farmers in Michigan that Senator
Stabenow has been telling me about, to our livestock producers.
On the rangeland in the West, they are good stewards, too, and
they don't get anything for it either. So they ought to be
involved in this, too. So I appreciate your support on that
approach. Again, any further advice and suggestions you have,
we would like to have that.
Mr. Specht. We will certainly continue to work with you,
Senator.
Senator Harkin. Thank you very much. Thank you, Mr.
Chairman.
The Chairman. Thank you very much, Senator.
Mr. Specht, in your sort of thinking outside the box, it is
intriguing when you mention you are not sure you want the
organic farmers into the program crop group.
We had some testimony of this. This is anecdotal, perhaps,
and it may be broader from some of the farmers who are
producing fruits, vegetables and nuts and other things that are
sometimes thought of as being niche crops but now are very much
larger as a part of the total farm income, making this the same
point that risk is involved in these areas and so prices are
higher.
Once you have a program crop, cotton, rice, corn or wheat,
as a matter of fact, however else we talk about it, there are
strong incentives to over-produce and prices remain low, almost
bound to remain low. That is a problem. How we liberate the
system from this situation or simply accept the fact that this
is the way the world works, I don't know, but it is an
interesting thought.
You know, in equity, why should not organic folks get into
the situation, along with peaches and cherries and nuts and
whatever or tobacco, cotton, rice, almost anybody in equity.
But it makes an interesting predicament in terms of those
equities, you know, how the pie is going to be sliced.
In the past, we have not been too constrained. We have just
said more of everybody and built a broad coalition.
But, nevertheless, we are doing a new farm bill. We have an
opportunity to take a look presently. So I appreciate even
these unconventional suggestions from unconventional questions.
Senator Nelson.
Senator Nelson. Thank you very much, Mr. Chairman. I hear a
lot of concern about the programs that are coming into place
that I think are great incentive programs, but they tend to
reward new applications. They don't necessarily go back and
take care of those who have already engaged in significant
environmental work.
I know it is true that virtue is its own reward, but I have
found that if you can help compensate and help take care of
those who have done the right thing, that is also advisable. It
may even inspire others to do so.
Do any of you have any specific suggestions, about what we
might do to go back and reward those who have already engaged
in favorable practices, who have already done ``the right
thing'' so that we do take care of that? It is not just about
new applications and new applicants.
Mr. Specht. Senator Nelson, that is the environmental
incentive payment portion of our toolbox. We do understand the
importance of maintaining what has already been done as opposed
to, as you accurately suggest, programs in the past that talk
about implementing practices. That is an important component,
too.
But, we do think it is very important to maintain good
practices and that is why our environmental incentive payment
approach is a part of our toolbox.
Senator Nelson. It would be retrospective as well as
prospective?
Mr. Specht. Yes.
Senator Nelson. Thank you.
Mr. Buis, you recommend increasing the CRP acres and I
think others have as well--certainly, I agree with that--and
making itcomparable to local rental rates. Making it
competitive, making it attractive, certainly is advisable.
Do you have a sense of how much this might cost us overall,
being that somebody is always watching the bottom line, I am
interested in knowing if you have identified anything of that
sort.
Mr. Buis. Well, if we increase the acreage cap by another
three million acres, roughly, if you add an average rental rate
of, say, $60 per acre, it is going to cost some money. But I
think all these programs are going to cost money.
You know, in agriculture today our backs are very much
against the wall from the budget perspective. I know we and
most of the farm organizations recently sent a letter to the
budget committees saying that if we are going to address the
challenges we face, we are going to have to make that
commitment to the budget.
But we think CRP is a valuable tool and one that pays back
in the benefits to rural America.
Senator Nelson. Thank you. I also noticed, Mr. Buis, that
you mentioned that the programs should be aimed to really
benefit family arms. I recall the Chairman referring to his
farm as a transitional farm. I have not figured out whether he
is transitioning up or transitioning out. He may not know
either.
But, is there a size factor, not necessarily total acreage,
but size on the basis of the kind of agricultural producer you
are talking about?
Mr. Buis. I think there is. Our delegates actually are
meeting this weekend in Rochester, New York to try to put some
more pieces to the puzzle for the conservation provisions. But,
I think there is a size limitation.
One of the big concerns that we see growing out of here is
in the nature of livestock manure management systems and who is
eligible for those benefits and who is not and what kind of
competitive advantage that gives a large, integrated operation
over an independent hog producer. We have seen over 75 percent
of them disappear in the past 10 years.
So we are very concerned about that. We want to make sure
that assistance is available because money is hard to come by
to put in new management tools out there right now. We will be
glad to share that with you after our convention.
Senator Nelson. Well, clearly, there is a difference
between the size of a farm with low rainfall or no access to
significant irrigation or other modifications and one that
maybe can produce the same level of income on a much smaller
plot.
So I would hope there would be some effort to help us
identify what is big. I am concerned about what transition
means, Mr. Chairman. I hope you are transitioning up. My fear
is that you are not.
Thank you.
The Chairman. Well, thank you very much.
Senator Harkin. Ben, I don't know if you were here earlier
to see this, but these are the payments we had last year to
CCC: $32 billion and $1.9 billion for conservation. The point I
made earlier, and I will make it to this panel again and anyone
else who will listen is that things have not improved that much
in rural America price-wise so we can say, ``Oh, now we can
forget about the $32 billion, we can just forget about that.''
No, we can't, because prices are still low. Our rural
communities are hurting. Our farm families are hurting. The
question is: Do we continue to put it out the way we did or do
we raise this up and put more emphasis on a conservation-based
voluntary incentive program that might be more equitable and
might be more widespread in terms of involving more farmers
from around the country, in different parts of the country,
that have not been involved before, down in the southeastern
part of the United States, down in the Plains States, where
they really haven't gotten much of this.
So that is sort of the point I keep trying to make, that
maybe this has to go up, not that we cut that down, but we
bring this up.
The Chairman. Well, Senator Harkin presents a very
appealing picture for everybody in this room. I suppose that we
will have to work with the rest of our colleagues as to whether
we can simply add on both sides. They may be willing to do
that. Otherwise, we get back, as we often do, to the
priorities.
Senator Harkin. Don't misunderstand. I am saying that I
don't want to change the total. This may have to go. This kind
of a payment may have to come down, but I am just saying don't
reduce the total because we can't afford it in rural America.
That is all I am saying.
The Chairman. I suspect that is about right.
I just want to reassure Senator Nelson that I was surprised
to find that my farm was in transition, but I was citing the
Sparks, Incorporated study which showed that we sort of come
into the second group of ten percent after the larger eight
percent. The point they made is that farmers in this and this
category, about 57 percent of their income comes from off the
farm and 43 percent comes from on the farm.
So it raises a good question because probably that
indicates that if you were going to support a middle-class
income family, send your children to college and other things
that people want to do, you need to be farming more land. Now,
you may not own all of it, but our experience, at least in
Indiana, is that many farmers with, say, 1500 acres, 2000, rent
part of that, and maybe more, to amortize their unit cost and
so forth.
So there is a certain sense of transition by generation as
to how to make it profitable, as you know from your own
experience in Nebraska.
Well, we thank each one of you as witnesses for your
testimony, for listening to our colloquy both with you and each
other, and we look forward to working with you as we proceed in
this title and in others.
Now, I would like to call our third panel: Mr. David
Stawick, President of the Alliance for Agricultural
Conservation and Mr. Paul Faeth, Director of the World
Resources Institute.
We welcome our witnesses. Most of you know that David
Stawick is a former member of our staff of this committee. He
was very active during the formation of the 1996 Farm Bill.
The alliance that he heads is a new project of several
agribusiness firms including Cargill, ConAgra, Farmland
Industries, Monsanto, Pioneer and Syngenta. I would like to
mention furthermore that Mr. Faeth, Director of World Resources
Institute heads an organization that provides very
comprehensive data on a broad array of environmental, economic
and social issues.
Among other things, Mr. Faeth will be summarizing a report
he co-authored, discussing the use of nutrient-trading
mechanisms to enhance the environment and provide additional
income for agriculture.
The WRI has a very informative website for those interested
in that, at www.wri.org.
We are delighted to have both of you. Mr. Stawick, would
you proceed and try to summarize your comments. As you will
remember from your days with the committee, 5 minutes more or
less, followed by Mr. Faeth and then questions from Senators.
STATEMENT OF DAVID STAWICK, PRESIDENT, ALLIANCE FOR
AGRICULTURAL CONSERVATION, WASHINGTON, DC
Mr. Stawick. Good morning, Mr. Chairman, Senator Harkin and
Senator Nelson. Mr. Chairman, if I may say so, it was always an
honor to sit behind you at a hearing like this and it is a
privilege to sit in front of you for a change. Thank you.
I appreciate the opportunity to testify. I am very excited
about the hearing so early in the process, as has been
mentioned.
The mission of our new Alliance for Agricultural
Conservation is to advocate additional financial incentives for
farmers and ranchers to apply conservation measures on working
agricultural lands.
More incentives, focus on working lands. I know certainly
that you and Senator Harkin share that focus with your work on
EQIP, Mr. Chairman, in 1996, and Senator Harkin, with your
Conservation Security Act now. We appreciate that.
I would like to describe four conservation issues that we
suggest you tackle in the conservation title of the next farm
bill. The first is to address this issue of the shortages in
incentives for conservation practices.
You have heard a lot of estimates from the very fine panels
we have had earlier today. I would simply say that none of
those are unreasonable from where I sit, at least in terms of
those total numbers.
There are also some possibilities for improving the EQIP
Program or whatever program might supplant it or accompany it
in the future. I mention them in my written testimony and if
you would like to discuss them later, I would be happy to do
so.
Your staffs have asked this panel to kind of get out of the
box a little bit more, as has been done earlier. Some of those
issues have already been touched upon. I will take that path
with our three remaining issues.
The second of those is to leverage conservation funds
through market-based initiatives. In many regions there is very
strong, but untapped, economic justification for utilities or
business entities or States and local governments to provide
incentives to landowners who adopt conservation practices.
This kind of gets to the whole issue of the value of
conservation. You were talking about conservation commodities
and the value of those to the public at large, people in urban
areas.
Now, Mr. Faeth is going to talk about one approach, credit
trading. He has a very interesting piece of testimony. I will
defer to him on that.
Another idea, though, that you may consider is the
establishment of local best management practice funds, BMP
funds, from which EQIP-style payments could be channeled to
participating landowners.
Now, these BMPs would reduce pollutant loadings at the
source so that expensive, for example, drinking water treatment
facilities down closer near the tap wouldn't be needed. The
savings to rate payers can be huge. Mr. Rudgers alluded to that
type of activity in his statement as something that is already
going on with the dairy farmers in the New York City watershed.
Now, the Federal Government role in these otherwise market-
oriented strategies might be to assist in the initiative
capitalization of BMP funds or credit trading scenarios.
For example, in qualifying projects, the Federal Government
might kick in a dollar for every $2 or $3 that a non-Federal
entity would put in for a BMP fund or for buying pollutant
credits--and those Federal dollars should be passed on to
farmers.
BMP funds and credit trading are not a substitute, I would
say, for other incentive programs such as EQIP, but they hold
tremendous potential. They are not just pipe dreams. They have
gone on in various places, Mr. Chairman. For example, they have
gone on in the Fort Wayne watershed. We have seen them in New
York City.
Paul is going to talk about his website. So these are not
arcane concepts whatsoever.
The third issue is to increase agricultural landowners'
access to conservation technical assistance. Environmental
challenges to farmers and ranchers have proliferated, but as
Paul Johnson mentioned earlier, the ability of the Federal
Government through the NRCS to provide necessary technical
assistance has declined.
I want to be very clear that we very strongly support NRCS
and its local conservation district partners. But current
realities and likely future demands dictate a rethinking of
NRCS's role in the delivery of conservation technical
assistance.
One option might be to focus NRCS field staff on the needs
of landowners with limited resources. At the same time, larger,
more capitalized landowners could employ private crop advisers
and engineers, and agronomists, whose qualifications to make
those recommendations would be certified by NRCS. So it would
be an expanded certification process for that agency.
I understand this is a very sensitive area for people in
the conservation world. I simply suggest that recent history
strongly suggests that NRCS as currently focused and funded
will not be able to provide the technical assistance that is
needed in the countryside.
Strategic issue four is to examine a comprehensive national
policy for working lands conservation. You have talked about
that before this morning as well. Our Nation's natural
resources are protected by a series of somewhat overlapping
laws and regulations authorized by several statutes under the
authority of many different committees.
The environment is generally well served by this regime,
but it can provide exasperation for landowners and actually
hinder better environmental stewardship. We know the examples,
the wetlands programs, the Clean Water Act Programs.
The jurisdictional hurdles that I mentioned will prevent
this committee from solving this problem in this farm bill. But
there may be a couple of things that you could do as the
Agriculture Committee in the short run.
One would be to authorize an outside group that would
identify legislative and regulatory overlaps, point out the
jurisdictional barriers that exist in Congress and suggest
strategies for moving legislation that could bring more
regulatory certainty to landowners who participate in USDA
conservation programs, sort of have a legislative road map that
you as Chairmen and Ranking Members could use to link arms and
move forward.
Another idea might be to direct the agencies themselves to
look at a similar investigation.
I close, Mr. Chairman, with two final suggestions that
impact on all these strategic issues that I mentioned. First, I
suggest that you delineate goals for what the conservation
title of the next farm bill should accomplish through voluntary
incentive-based programs. How much should we reduce agriculture
nonpoint source pollution? What percentage of land should meet
the soil loss tolerance? I am talking about specific things,
strong goals that will help focus on what approaches and
funding increases are appropriate and will also help generate
necessary support from outside this committee when you go to
the Floor and when you get to conference.
Second, make environmental performance paramount. This is
relevant when you discuss, as you have this morning, replacing
to some degree commodity supports with payments that are based
on conservation.
New conservation funds, I would suggest, must really result
in environmental gains. Anything less would ultimately be cruel
to landowners who are staring down the gun barrel of
environmental regulation and it would also be hollow for the
urban dwellers, the taxpayers, who stand to benefit from
conservation on working agricultural lands.
Thank you, Mr. Chairman.
[The prepared statement of Mr. Stawick can be found in the
appendix on page 222.]
The Chairman. Thank you very much, Mr. Stawick, for a very
important paper and for your summary this morning.
Mr. Faeth.
STATEMENT OF PAUL FAETH, DIRECTOR, WORLD RESOURCES INSTITUTE,
WASHINGTON, DC
Mr. Faeth. Thank you, Mr. Chairman. By way of introduction,
I would like to say, for those of you who do not know, that the
World Resources Institute is a private, nonprofit, nonpartisan
environmental think tank. What we try to do is figure out good
ideas and implement them to change the way things work to
improve the environment and also people's lives.
Our goal is to identify and implement and protect policies
that protect the environment in ways that maintain and improve
farm income in this area of conservation.
In recent years much of our work has focused on the
development of markets for environmental services that can be
cost-effectively provided by farmers. The two most likely
opportunities that appear to be able to be generated in the
near term include markets for reductions in nutrient runoff and
greenhouse gas emissions.
Water quality is consistently rated by the public as the
number one environmental issue. EPA has identified nutrients as
the biggest cause of water quality problems with as many as
3,400 waterways impaired by nutrients.
In addition, nutrient over-enrichment also leads to hypoxic
zones, areas where the oxygen in the water is too low to
support life. The largest of these is the so-called ``dead
zone'' in the Gulf of Mexico, an area the size of New Jersey.
As directed by Congress, EPA recently released a task force
report that calls for reduction in the size of the ``dead
zone'' through voluntary actions by nonpoint sources and
existing regulatory control of point sources in the Mississippi
Basin.
The cost of meeting clean water goals could be quite high
with traditional approaches of command and control, coupled
with more or less untargeted subsidies. But a cap and trade
system, a market, could cut the cost dramatically.
Under the Clean Water Act, impaired waterways will
eventually face some sort of a limit on loads. Point sources
like municipal sewage treatment plants and industrial treatment
works will have new obligations to cut nutrient loads.
This is handled currently through the TMDL or Total Maximum
Daily Load process that sets a maximum load and allocates it
among the dischargers in the watershed.
With that process, basically you are half way to a cap and
trade system. The only element missing is to create markets to
trade surplus nutrient reductions through investments in
agricultural BMPs. With that, we need clear Federal guidance to
do so and that doesn't now exist.
We worked with State agencies in Minnesota, Michigan and
Wisconsin to do studies to explore the cost and benefits of
market-based mechanisms to support nutrient load reductions
such as those under a TMDL.
We found that compared to traditional command and control
regulations on municipal and industrial dischargers, nutrient
trading could cut the cost of meeting environmental goals by 62
to 88 percent in those States.
The simple idea here is that point sources could pay
farmers to install cost-effective best management practices for
nutrient management and take credit for reductions under the
Clean Water permits.
We are currently developing and testing a website called
``nutrientnet'' at www.nutrientnet.org to create nutrient
trading markets and provide farmers with tools to participate.
Mr. Lugar, you mentioned earlier about mentioning maps and a
variety of systems that are now available. We are using just
this technology to implement this website.
We are testing this and implementing it with State agencies
and other stakeholders in Michigan, Idaho, and the Chesapeake
Bay Watershed.
One of the fascinating elements of nutrient trading that I
have found, specifically for nitrogen, is that it can also help
meet the climate challenge. The largest source of greenhouse
gases from agriculture is nitrous oxide, largely, but not
solely from excess fertilizer use.
There is a very tight synergy between water quality
management and climate protection for this reason, as well as
another opportunity for the creation of an environmental
market. For comparisons sake, a 10 percent reduction in nitrous
oxide emissions from agriculture would be about equal to all
the carbon sequestered annually in the CRP.
If the U.S. someday decides to constrain its greenhouse gas
emissions and uses a cap and trade system to do that, then
farmers could generate credits to sell in such a market through
a variety of BMPs that not only have climate benefits, but also
reduce nutrient loads, protect the soil, and provide wildlife
protection.
So how does all this relate to the farm bill? The key, I
think, is to help farmers get ready to participate in
environmental markets and make conservation programs behave
more like markets. To that end I have a few suggestions.
First, I think it is important to provide incentives to
encourage farmers to provide more environmental services to
society. Not only could this help farmers address their own
environmental issues, but also help them to create
environmental benefits for the rest of the economy.
In the context of the Farm bill, I think this means
increasing the funding available for programs like EQIP, WRP
and new programs perhaps such as the Conservation Security Act.
This would be a good first step.
A number of conservation organizations are putting forward
a plan for spending increases which I think is generally in the
right direction.
Second, there is no substitute for doing the research.
Markets dependent on the ability to be sure about what one is
buying. That means we need to be able to measure environmental
services, verify and monitor.
Third, conservation subsidies, to the extent possible,
should be based on performance. The Environmental Benefits
Index and the Conservation Reserve Program is one example. But
it could be extended to other programs.
Going one step further, and finally, I would recommend that
the next farm bill include pilot programs that are fully market
based. Why not allocate money for a pilot nutrient trading
program or greenhouse gas program? The government could act as
the buyer, which essentially would be a market-based type
program. Farmers could use the Internet to estimate how much it
would cost to generate a nutrient or greenhouse gas credit and
sell it to the Government in a competitive way.
Such programs could help prime the market, so to speak, so
when the time comes farmers will be fully able to take
advantage of this.
Building on what Dave said, I would also like to mention
strategy. I wouldn't be from a think tank if I did not somehow
talk about or think about strategy.
If you look at through variety of policy opportunities like
the Farm Bill, the Clean Water Act, the Hypoxia Action Play,
perhaps the Kyoto Protocol, with the right lens you see
opportunities for farmers to provide services to the rest of
the economy, and also, and not secondarily, put a few bucks in
their pockets.
Thank you very much.
[The prepared statement of Mr. Faeth can be found in the
appendix on page 227.]
The Chairman. Well, thank you very much, Mr. Faeth.
Let me just comment briefly that the Congress faced in the
Clean Air Act this market-based strategy up front and the
trading of those credits with utilities or others who are
creating some clean air problems and other people who are
taking mitigating strategies, or had at least much more clean
air focus that had been going on for some time.
The result has been, among other things, cleaner air in the
country, a reduction of a number of situations. Now, this has
not gone without some criticism and I suppose that this is most
focused in the most recent international conference in which
the Europeans rejected out of hand the proposal by our
Department of State that somehow when you come to clean air in
the world that this credit system would be favorable, as they
saw it, to the United States, having developed these markets
and the concept.
Those who wanted the clean air wanted some punishment for
the polluters. In other words, as opposed to simply mitigating
the amount of pollutants in the air in the world, etc., they
wanted to get at the malefactors, or it could simply have been,
in some cases, an allegation of sheer protectionism. That is,
some continents felt this that still gave American producers
too much of an edge and they wanted a little punishment to sort
of mitigate their advantages.
Well, whatever may have been the problem, it did not work
out in that conference. Now, this is an interesting idea as you
move along now more toward the water business and the clean
water and the creation, certainly, of problems of point and
nonpoint pollution which we have been hearing about a good bit
today.
I think the idea is a remarkable one on its merits, but it
also gets at the problem that underlies a part of our farm bill
consideration: What about the 64 percent of farms who get no
payments under the current income support situations, or
farmers who are not planting for either the subsidies, either
the safety net, however one wants to characterize the
situation?
We had testimony earlier about the management of land by a
farmer in Iowa who is doing a number of things. It would appear
to be conservation-oriented and very specific for his own
satisfaction, but there are occurring societal benefits.
Now, to the extent that we are able to work out markets,
whether they be in carbon sequestration of the sort that has
been talked about with the planting of trees or no-till or
various other situations, or whether we work at it--and you
have pointed out with the nitrous oxide that could be reduced,
and these mechanisms that you are suggesting, clearly, there is
a potential for income for a lot of farmers who engage in sound
conservation practices.
We have not really come to a decision in the Committee or
even begun to debate this in the Congress as to what the major
objectives ought to be of landowners, including farmers, and
producers in America. But clearly there is some consensus that
a major one ought to be stewardship.
In terms of our national interests, why do taxpayers who
are not farmers, not producers, want to put money into all of
this? One reason may very well be the national interest is to
have cleaner air, cleaner water, preservation of our basic
assets, which include stopping soil erosion or problems of
nutrients leaving the soil.
I think this is an extremely important concept. The problem
that I see thus far is that most working farmers are not able
to envision exactly how this works. They hear discussions such
as this. They watch C-SPAN and their eyes light up. But there
doesn't seem to be anything out there that follows through on
this.
I visited with some people. One of our jurisdictions is the
Commodity Futures Market, the CFTC authorization and those who
deal in these sorts of things. I visited with leaders in that
industry a month or two ago to discuss how they are coming,
say, with the carbon sequestration markets. They are coming
along pretty fast. There may be some possibilities of some
markets on a much broader scale than simply a pilot project. I
don't demean that for a moment.
Your suggestion here is, I suppose, based on the thought
that with such a new idea for this committee or this Congress
or this administration to tackle it wholesale may be a bridge
too far, that you sort of work at it.
But nevertheless, we are talking about a farm bill of
several years duration, probably. How income comes to farmers,
why there is a Federal interest in providing income to farmers
beyond that which occurs directly in the sale of commodities.
I appreciate your outlining this and I take this time to
underline that because it appears to me that this is a very
important objective in terms of the public interest as well as
farm income and perhaps for those of us--and most of us are
interested in the overall environment of our country or our
world--a distinct contribution.
Now, in the work that you are doing in the pilot projects
now, and I have not had a chance to visit the website you cited
this morning, what happens on that website? Are people
contemplating hypothetical trading situations? Can you describe
to us what you might find for those who might want to get into
this?
Mr. Faeth. Yes, Sir. We have copies of a brochure on the
website. It is available and it is functional now. We had been
doing tests on this; our first live test with farmers and point
source discharges was in Kalamazoo, Michigan a month ago. The
State of Michigan is going statewide with regulations allowing
nutrient trading in probably July or August.
In Kalamazoo, Michigan, they have a TMDL and the site will
be operational in support of the TMDL process for Kalamazoo.
Basically, it is a set of maps. So when you go to the site, if
you are a farmer, you click on your watershed and you see a
picture of the Kalamazoo watershed. It has the county
boundaries and the interstate highways, etc.
Then you click on the county where you live and you come up
with a road map. You click again and you get closer to where
you live. When you click there, what actually happens is that
it pegs through with a soils map, a topographic map, a land use
map, and a map of distance to the nearest stream, which the
farmer never even sees.
So all the information that you need to actually calculate
nutrient loads are pegged there, but the user never even knows
it.
Then the next step is, you say, okay, what am I doing now?
I am growing corn and beans with a no-till, etc. You run
through scenarios of, ``Well, what if I put in a buffer strip''
for example, or ``What if I want to create a wetlands?'' There
are a series of different options you can run through and it
tells you the cost per pound to remediate that is $8 per pound
of phosphorous kept out of the stream.
Next you go to a marketplace and you can post an offer, ``I
will be willing to sell phosphorous credits, 200, at $15 a
pound.''
Clearly you will want to do it at much higher than your
cost. But then the point sources can post bids to purchase. We
had 30 players in our last demonstration and we had about 20
trades that occurred between the parties.
The Chairman. These are actual commercial trades?
Mr. Faeth. These are demonstration trades at the moment.
This will be live in support of the TMDL for Kalamazoo in July.
The Chairman. Somebody would transfer some money? In other
words, somebody made a bid of $10 for this phosphorous and pays
some farmer who offered?
Mr. Faeth. That is right. Then these are registered with
the State agencies as appropriate. That is the next and final
step to actually register the credits and the trade and it
becomes real.
The Chairman. Well, you mentioned the TMDL. The last
hearing we had with regard to that was a very volatile hearing
because most people who came in who were farmers or with farm
organizations did not like the idea at all. As a matter of
fact, they wanted to stop.
Now, the people dealing with TMDLs, ``Well, we don't want
to do that.'' But it wasn't really aimed exactly at farmers. We
had some sort of amelioration of discontent in the process
aimed at other big polluters and so forth.
But, nevertheless, it was sort of out there and it came
largely because of disputes with the forestry interests. As I
recall, that particular hearing brought it to the fore. But it
is interesting that in Michigan there is a TMDL and people
still taking it seriously.
So as a result, even though farmers were saying, ``We are
not the ones,'' here is a farmer prepared, as you say, to adopt
the new plan. It is going to remove something, nonpoint though
this may be, from the waterways of Michigan.
Somebody else is willing to pay for that process. So I
think that is a very interesting and important breakthrough
which probably will engage more than 30 players after some
money passes hands and there is a commercial transaction.
Mr. Faeth. We are developing a version of the site for the
Mississippi Basin as a test, beginning next year. Paul Johnson
mentioned trading on the Chicago Board of Trade; we share the
same vision.
The Chairman. Well, I hope, in a parochial way again, it
will extend to White River in Indiana or the Wabash or some
places of this sort in due course.
Senator Nelson.
STATEMENT OF HON. BENJAMIN E. NELSON, A U.S. SENATOR FROM
NEBRASKA
Senator Nelson. Thank you, Mr. Chairman.
Mr. Stawick, I must commend you. You are the first person
to come that I have had the pleasure to hear saying that maybe
the Federal Government could give $1 dollar or $2 dollars to
get $4 somewhere else. Usually, it seems to work in the
reverse.
I agree with you that the EQIP Program is probably under-
funded. I think in your testimony you said that the payments
have been about $200 million and yet applications are probably
in the range of $600 million.
One of the ways that Nebraska has attempted to deal with
this is to use the leverage of local funds to be able to
attract EQIP funds and so there are stakeholders who could
conceivably help expand the availability of the results by
staying somewhere near or on the total dollars that are
expended under the EQIP Program at the Federal level.
I have to make a pitch for what I did. I created an
environmental trust fund. Part of the funding that goes into
the environmental trust fund comes from the Nebraska Lottery.
That was before Senator Harkin's State had so many riverboats
on their side of the river.
While this is not the generous level of support that the
total gambling provides, it has provided a significant amount
of money aimed at helping create co-activity in environmental
stewardship.
We have several examples of where the environmental trust
fund has funded on a multi-year basis projects that have then
qualified for EQIP funds to try to create the kind of leverage
that I think you had reference to. I would hope that other
stakeholders would find similar ways to come in and leverage
and expand the capacity of these funds to do good on so many
other levels. I hope that that will in fact occur.
Mr. Stawick. Senator, there is one other very good example
that was touched upon by Mr. Stevenson in yesterday's
testimony. That is the Conservation Reserve Enhancement Program
which is a sort of subset of the Conservation Reserve
Continuous Signup which is very explicitly involving State
governments in getting additional incentives to landowners atop
the CRP payments.
That is underway in, I think, about 12 States now,
Illinois, the Chesapeake Bay, Minnesota, etc.. So that is
another very substantial program that is out there. There are
more of these so-called CRP agreements, more and more every
year.
Senator Nelson. Well, I hope we continue to create these
kinds of partnerships on a multi-government basis because we
certainly can get more leverage out of the dollars from both
sides of the contributions.
Mr. Faeth, I am taken by the trade of environmental
transactions that you are talking about here. How are you
flying under the radar to not attract attention of the SEC to
begin with or the local Blue Sky laws within the States? I hope
you are able to stay under that radar.
For example, as you do that and there are dollars
exchanging hands ultimately, how do you have, first of all, the
collection of the dollars, but second, how do you have
enforcement because if I pay for these environmental practices,
I want to make sure that they occur at the other end.
Mr. Faeth. There are a variety of ways that these are being
worked out. Most of the programs that have been tried are
experimental programs right now. For example, in Michigan,
which is the first State to go statewide with a regulatory
program, the first step is that when there is a trade between
any of the two parties that it is registered with the State.
If one party has an NPDES permit and does a trade with
another party, for example, it may be two point source
dischargers who both have a permit.
Senator Nelson. So you have the equivalent of some sort of
exchange. It may not be the stock exchange or it may not be
something out of Chicago, but you have some mechanism.
Mr. Faeth. That is what our site does. It is a bulletin
board where you post offers to buy and sell. Parties look at
the site and they decide what they want to pay, look at their
own remediation costs. If they can buy cheaper than they can
treat, then they go ahead and do so.
For rural communities this could be a huge help. In
Minnesota one of our cases, has 212 point source dischargers,
only about 25 are larger than one million gallons a day in
effluent discharge. The rest are tiny. The cost per unit of
treatment is much higher for small facilities than for large
facilities. So for rural communities that face the highest cost
of water treatment, trading is probably the best way to keep
those costs down and make it more equitable in terms of what
the water treatment costs would be for those communities.
So when you trade, you have a contract. One of the things
that has been tried is a loan that the point source might
provide to the farmer to implement the practice and then the
loan it is paid back in credits.
Senator Nelson. How do you enforce? It is better to have a
contract than not have a contract. But sometimes both parties
don't always comply.
Mr. Faeth. Under the Michigan rules, if you voluntarily
undertake a trade with a party that has an NPDES permit, you
provide a commitment under law that you will meet the
obligation you set out in your trade.
So if you say, for example, I am going to exclude cattle
from the stream and you make that promise and take money to do
so, if you don't do it, you have to provide three times the
credits that you said you were going to provide.
So if you said this will generate 100 pounds of phosphorus
reductions and it is discovered that you don't, the owner of
the credits or the buyer of the credits has the right to
enforce and the State has the right to enforce as well.
If you voluntarily do that and you are found not to have
done it, then you owe 300 credits to the system. The credits
that the point source discharger was using to apply are invalid
and they have to go back into the market and purchase credits.
Senator Nelson. So enforcement may be civil or----
Mr. Faeth. It can be both. There are opportunities for
both.
Senator Nelson. [continuing.] Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Nelson, for
illuminating further this process because as we get back to our
CFTC responsibilities, the whole clearing process is of the
essence. Where you are sitting, Mr. Faeth, we had a trader in
corn last year. With a screen there in front of him, one that
we could watch, he sold 1,000 bushels of corn somewhere in
Europe, right here in the hearing room.
The problem then is enforcement, the contract clearance of
all of this. He went through a rather elaborate explanation as
to how it works. But this would be of the essence with a State
or with a Governor or with a court system.
Still, it is very important. I am glad you have thought
through those aspects. As you say, you are in the pilot project
part. Questions that we raise as lay people hopefully will get
back to those who are working in the system.
Mr. Stawick, when you mentioned the EQIP Program in your
testimony you suggested that, as has been pointed out, the
demand exceeds the funds. Perhaps one way of looking at this
would be small farms, those who do not have the resources of
large farms, for example, might have, through a priority, use
of the technical personnel that are now available and others
might employ consultants who then have some validation through
the professionals of their programs and their results.
Can you illuminate that any further without asking you what
the cut-off is between those who ought to be using or have
priority and those who are larger entities who might hire
consultants for more complex plans? Have you given any thought
to where we might demarcate that?
Mr. Stawick. One way of answering that, Mr. Chairman, might
be to look at what the reality is in a lot of areas already. I
suggest for technical assistance purposes, as you say, that the
NRCS field staff perhaps be considered as the--you will be
familiar with this term for agricultural lending--perhaps NRCS
field staff could be considered the technical assistance source
of last resort, so to speak, for persons of limited income.
The fact is, that is the case in a lot of counties in a lot
of conservation districts around the country right now. If you
look at the other end, there are the larger landowners who say,
``I know I need to do something.''
It may be a confined animal feeding operation that has an
NPDES permit. You know, they have to address those permit
requirements or they may want to put in conservation buffers
but may not want to go through the encumbrance of an EQIP
contract or a CRP contract. They say, ``I just want the
technical assistance. I need somebody to tell me how wide that
buffer should be and what type of cover should it have,'' etc.,
and they are willing to do that themselves, but they don't have
the technical help they need to answer those questions because,
again, the stretched NRCS staff is looking at other, more
limited resource people.
I don't know, Mr. Chairman, where that line is, but I would
suggest that if we got some more information from NRCS to look
in a lot of these areas, you know, who they are able to help,
who they are literally able to help with the current staffing
levels.
That may help drive us to some answers to your questions.
The Chairman. That could be. Obviously, NRCS would like to
have more staff and that may be the will of the Congress, to
provide more. My guess is if we were generally successful many
of the things we have been talking about today are going to
stimulate a lot more interest in conservation around the
country.
So even as we get the staff, we hope that there will be a
broader population of interest. We would come back to this
problem again and again in terms of the smaller farmers of
America, in terms of marketing strategies, to be able to use
puts and calls and future trading or this type of thing which
we found using the Sparks, Incorporated study that we talked
about, that the larger farmers, the eight percent, are
apparently selling corn for about 30 cents more a bushel than
are the group of smaller farms.
This is in part because they employ sophisticated marketing
strategies. They have people, who assist them, go to extension
courses or do more marketing education. It is not a question of
the rich getting richer or the poor getting poorer. But in
terms of technical expertise, this is very important. The
question is how do we get this more broadly disseminated? How
do we get people to ask for it, to know that it is even there
and to have confidence? So these are questions at least some
Senators are probing.
Mr. Stawick. Could I raise one other market potential on
this very question of technical assistance?
The Chairman. Yes.
Mr. Stawick. You might consider in the farm bill a system
in which there was some kind of technical assistance funding,
perhaps in the form of vouchers that could be given broadly to
landowners and which could be traded.
Depending on your size, depending on what are the
requirements in the TMDL in the watershed where you live, you
may want to take that voucher and redeem it for assistance
directly from NRCS or you may say, ``I'm fairly well set with
my technical assistance needs, perhaps I can sell that voucher
to somebody else who could then accumulate a few if necessary
and then get the technical assistance that they need.''
Those vouchers perhaps also could be redeemed by private
sector entities that I mentioned that could stand to get into
the technical assistance business if we could just get them
certified by NRCS.
So while that is obviously not really as well thought-out
as Paul's ideas on credit trading, that may be another way of
using some market forces to get technical assistance and
allocate our technical assistance resources, even the
Government technical assistance resources, where they are
needed the most.
The Chairman. Senator Nelson, do you have any further
questions?
Senator Nelson. Well, I was just going to say that if we
keep finding ways with securities and other kinds of trades, we
might find a way to make agricultural profitable.
The Chairman. Exactly. That is just what we are about.
I thank you very much for coming to us today. We thank all
the witnesses. We will try to take carefully into consideration
the papers that we made a part of the record in full.
The hearing is adjourned.
[Whereupon, at 11:55 a.m., the committee was adjourned, to
reconvene at the call of the Chair.]
=======================================================================
A P P E N D I X
March 1, 2001
=======================================================================
[GRAPHIC] [TIFF OMITTED] T4345.053
[GRAPHIC] [TIFF OMITTED] T4345.054
[GRAPHIC] [TIFF OMITTED] T4345.148
[GRAPHIC] [TIFF OMITTED] T4345.149
[GRAPHIC] [TIFF OMITTED] T4345.150
[GRAPHIC] [TIFF OMITTED] T4345.151
[GRAPHIC] [TIFF OMITTED] T4345.152
[GRAPHIC] [TIFF OMITTED] T4345.153
[GRAPHIC] [TIFF OMITTED] T4345.154
[GRAPHIC] [TIFF OMITTED] T4345.155
A[GRAPHIC] [TIFF OMITTED] T4345.156
[GRAPHIC] [TIFF OMITTED] T4345.157
[GRAPHIC] [TIFF OMITTED] T4345.158
[GRAPHIC] [TIFF OMITTED] T4345.159
[GRAPHIC] [TIFF OMITTED] T4345.056
[GRAPHIC] [TIFF OMITTED] T4345.057
[GRAPHIC] [TIFF OMITTED] T4345.058
[GRAPHIC] [TIFF OMITTED] T4345.059
[GRAPHIC] [TIFF OMITTED] T4345.060
[GRAPHIC] [TIFF OMITTED] T4345.061
[GRAPHIC] [TIFF OMITTED] T4345.062
[GRAPHIC] [TIFF OMITTED] T4345.063
[GRAPHIC] [TIFF OMITTED] T4345.064
[GRAPHIC] [TIFF OMITTED] T4345.065
[GRAPHIC] [TIFF OMITTED] T4345.066
[GRAPHIC] [TIFF OMITTED] T4345.142
[GRAPHIC] [TIFF OMITTED] T4345.143
[GRAPHIC] [TIFF OMITTED] T4345.144
[GRAPHIC] [TIFF OMITTED] T4345.145
[GRAPHIC] [TIFF OMITTED] T4345.067
[GRAPHIC] [TIFF OMITTED] T4345.068
[GRAPHIC] [TIFF OMITTED] T4345.069
[GRAPHIC] [TIFF OMITTED] T4345.070
[GRAPHIC] [TIFF OMITTED] T4345.071
[GRAPHIC] [TIFF OMITTED] T4345.072
[GRAPHIC] [TIFF OMITTED] T4345.073
[GRAPHIC] [TIFF OMITTED] T4345.074
[GRAPHIC] [TIFF OMITTED] T4345.075
[GRAPHIC] [TIFF OMITTED] T4345.076
[GRAPHIC] [TIFF OMITTED] T4345.077
[GRAPHIC] [TIFF OMITTED] T4345.117
[GRAPHIC] [TIFF OMITTED] T4345.118
[GRAPHIC] [TIFF OMITTED] T4345.119
[GRAPHIC] [TIFF OMITTED] T4345.078
[GRAPHIC] [TIFF OMITTED] T4345.079
[GRAPHIC] [TIFF OMITTED] T4345.080
[GRAPHIC] [TIFF OMITTED] T4345.081
[GRAPHIC] [TIFF OMITTED] T4345.082
[GRAPHIC] [TIFF OMITTED] T4345.083
[GRAPHIC] [TIFF OMITTED] T4345.084
[GRAPHIC] [TIFF OMITTED] T4345.085
[GRAPHIC] [TIFF OMITTED] T4345.086
[GRAPHIC] [TIFF OMITTED] T4345.087
[GRAPHIC] [TIFF OMITTED] T4345.088
[GRAPHIC] [TIFF OMITTED] T4345.089
[GRAPHIC] [TIFF OMITTED] T4345.090
[GRAPHIC] [TIFF OMITTED] T4345.091
[GRAPHIC] [TIFF OMITTED] T4345.092
[GRAPHIC] [TIFF OMITTED] T4345.093
[GRAPHIC] [TIFF OMITTED] T4345.094
[GRAPHIC] [TIFF OMITTED] T4345.095
[GRAPHIC] [TIFF OMITTED] T4345.096
[GRAPHIC] [TIFF OMITTED] T4345.097
[GRAPHIC] [TIFF OMITTED] T4345.102
[GRAPHIC] [TIFF OMITTED] T4345.103
[GRAPHIC] [TIFF OMITTED] T4345.104
[GRAPHIC] [TIFF OMITTED] T4345.105
[GRAPHIC] [TIFF OMITTED] T4345.106
[GRAPHIC] [TIFF OMITTED] T4345.107
[GRAPHIC] [TIFF OMITTED] T4345.108
[GRAPHIC] [TIFF OMITTED] T4345.109
[GRAPHIC] [TIFF OMITTED] T4345.110
[GRAPHIC] [TIFF OMITTED] T4345.111
[GRAPHIC] [TIFF OMITTED] T4345.112
[GRAPHIC] [TIFF OMITTED] T4345.113
[GRAPHIC] [TIFF OMITTED] T4345.114
[GRAPHIC] [TIFF OMITTED] T4345.115
[GRAPHIC] [TIFF OMITTED] T4345.120
[GRAPHIC] [TIFF OMITTED] T4345.121
[GRAPHIC] [TIFF OMITTED] T4345.122
[GRAPHIC] [TIFF OMITTED] T4345.123
[GRAPHIC] [TIFF OMITTED] T4345.124
[GRAPHIC] [TIFF OMITTED] T4345.125
[GRAPHIC] [TIFF OMITTED] T4345.126
[GRAPHIC] [TIFF OMITTED] T4345.127
[GRAPHIC] [TIFF OMITTED] T4345.134
[GRAPHIC] [TIFF OMITTED] T4345.135
[GRAPHIC] [TIFF OMITTED] T4345.136
=======================================================================
DOCUMENTS SUBMITTED FOR THE RECORD
March 1, 2001
=======================================================================
[GRAPHIC] [TIFF OMITTED] T4345.055
[GRAPHIC] [TIFF OMITTED] T4345.098
[GRAPHIC] [TIFF OMITTED] T4345.099
[GRAPHIC] [TIFF OMITTED] T4345.100
[GRAPHIC] [TIFF OMITTED] T4345.101
[GRAPHIC] [TIFF OMITTED] T4345.116
[GRAPHIC] [TIFF OMITTED] T4345.128
[GRAPHIC] [TIFF OMITTED] T4345.129
[GRAPHIC] [TIFF OMITTED] T4345.130
[GRAPHIC] [TIFF OMITTED] T4345.131
[GRAPHIC] [TIFF OMITTED] T4345.132
[GRAPHIC] [TIFF OMITTED] T4345.133
[GRAPHIC] [TIFF OMITTED] T4345.137
[GRAPHIC] [TIFF OMITTED] T4345.138
[GRAPHIC] [TIFF OMITTED] T4345.139
[GRAPHIC] [TIFF OMITTED] T4345.140
[GRAPHIC] [TIFF OMITTED] T4345.141
[GRAPHIC] [TIFF OMITTED] T4345.146
[GRAPHIC] [TIFF OMITTED] T4345.147