Order Code RL33556
Soil and Water Conservation: An Overview
Updated February 9, 2007
Jeffrey A. Zinn
Specialist in Natural Resources Policy
Resources, Science, and Industry Division

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Soil and Water Conservation: An Overview
Summary
Soil and water conservation topics will be prominent in the 110th Congress,
especially as it considers policy options for the next farm bill. Conservation
proposals introduced late in the 109th Congress (H.R. 6064 and H.R. 6193) are
expected to be reintroduced, and many interest groups continue to offer policy
recommendations ranging from general concepts to specific legislative language.
On January 31, 2007, the Administration released its farm bill recommendations.
The current farm bill, enacted in 2002 and generally expiring at the end of
FY2007, increased spending and expanded the scope of the conservation effort by
reauthorizing and amending many U.S. Department of Agriculture (USDA)
conservation programs and enacting new ones. An example of increased spending
is the Environmental Quality Incentives Program (from $200 million annually before
FY2002 to $1.3 billion in FY2007); and an example of a raised enrollment ceiling
is the Wetlands Reserve Program (from 1,075,000 acres to 2,275,000 acres). Several
new programs also expanded the scope of conservation. For example, the
Conservation Security Program (CSP) provides payments to producers who address
natural resource concerns as part of their farm operation on so-called “working
lands.” Other new programs were created to conserve grasslands, address surface
and ground water conservation needs, permit approved third parties to provide
conservation assistance, and encourage use of innovative conservation technologies.
Implementation controversies have arisen since 2002. One of these, how to
fully fund technical assistance in support of the mandatory conservation programs,
was resolved with legislation enacted in 2004 (P.L. 108-498). A second,
implementing the CSP, continues as Congress has repeatedly limited funding and
USDA’s Natural Resources Conservation Service, the implementing agency, has
responded by limiting program eligibility to specified watersheds, instead of making
it available nationally.
Congress continues to monitor conservation topics. Oversight hearings were
held in earlier congresses, and are scheduled under new leadership in both the House
and Senate Agriculture Committees. Topics addressed at recent conservation
hearings include endangered species, the Conservation Reserve Program, the
Environmental Quality Incentives Program, and the overall status of the conservation
effort. Conservation also was discussed during several field hearings held by the
House Agriculture Committee to gather farm bill input.
Congressional appropriators influence conservation topics annually. The
Administration has submitted its FY2008 budget proposal, which will initiate this
year’s appropriations process. FY2007 funding is being provided under a continuing
resolution, which Congress currently is working to extend through the fiscal year.
Conservation funding under the FY2007 budget resolution is similar (with one
notable exception) to actions in FY2006 on appropriations, when Congress agreed
to make cuts in several mandatory programs, while rejecting cuts to discretionary
programs that were proposed by the Administration.

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Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Evolution of Federal Resource Conservation Issues . . . . . . . . . . . . . . . . . . . 2
Current Major Conservation Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Conservation Reserve Program (CRP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Wetlands and Agriculture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Environmental Quality Incentives Program (EQIP) . . . . . . . . . . . . . . . . . . . 7
Conservation Security Program (CSP) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Technical Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Selected Other Conservation Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Watershed Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Conservation Compliance and Sodbuster . . . . . . . . . . . . . . . . . . . . . . 12
Resource Conservation and Development (RC&D) . . . . . . . . . . . . . . 12
Farmland Protection Program (FPP) . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Wildlife Habitat Incentives Program (WHIP) . . . . . . . . . . . . . . . . . . . 13
Emergency Conservation Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Water Quality Programs and Initiatives . . . . . . . . . . . . . . . . . . . . . . . . 14
Private Grazing Lands Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Grasslands Reserve Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Healthy Forests Reserve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Air Quality Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Research and Technical Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Program Evaluation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Other Conservation Programs and Provisions in the 2002 Farm Bill . 16
Conservation Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
FY2008 Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
FY2007 Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2007 Farm Bill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

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Soil and Water Conservation: An Overview
Most Recent Developments
On January 31, 2007, the Administration released its detailed set of
recommended solutions to problems it would like to have Congress address in the
2007 farm bill. This is the culmination of a lengthy effort, which included numerous
“listening sessions” and the release a “farm bill theme paper” on conservation in June
2006.1 The ten recommended solutions would:
! reauthorize and amend existing programs;
! consolidate similar programs;
! increase assistance to new and financially challenged farms;
! encourage a more market-based approach; and
! repeal the so-called regional equity requirement for spending.
Many others are developing alternative conservation proposals for this farm bill.
Numerous proposed changes were compiled in two bills introduced late in the 109th
Congress (H.R. 6064 and H.R. 6193) that are likely to be reintroduced, probably with
changes. Interest groups are expressing support or opposition to many of the
proposals that have emerged, including the Administration proposals, and will
continue to do so throughout the farm bill process. Another document that may help
to inform the farm bill debate is the strategic plan for USDA’s Natural Resources
Conservation Service (NRCS), which administers most of the conservation programs,
to guide its activities until 2010.2
Congress has not enacted FY2007 agriculture appropriations, so funding is
being provided under a continuing resolution that expires on February 15, 2007 (P.L.
109-383). A new continuing resolution that would extend through the remainder of
FY2007 is currently being considered. This current resolution generally provides
funds at the lower of either the FY2006 level or the House-passed level in H.R. 5384.
When the resolution was enacted, the Senate version had been reported by the
Appropriations Committee, but no action had been taken on the floor. The full
House and the Senate committee both rejected many reductions for discretionary
conservation programs that the Administration had requested. These reductions
would have totaled just over $200 million. For mandatory conservation programs,
current law authorizes funding for these programs to increase by almost $330 million,
1 U.S. Department of Agriculture, 2007 Farm Bill Theme Papers: Conservation and the
Environment, June 2006, 41 pp.
2 Natural Resources Conservation Service, Productive Lands Healthy Environment:
Strategic Plan 2005 -2010, May 2006, 100 pp. The plan states that NRCS will follow three
overarching strategies: the watershed approach; market-based approaches; and cooperative
conservation (a Bush Administration initiative).

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but the Administration called for some decreases from authorized levels in FY2006.
The House added reductions for several programs. The Senate bill is generally
similar to the House bill, with the exceptions of providing full funding for the
Wetlands Reserve Program (as the Administration had requested) and for the
Conservation Security Program.

Evolution of Federal Resource Conservation Issues
Conservation of soil and water resources has been a public policy issue for more
than 60 years, an issue repeatedly recast as new problems have emerged or old
problems have resurfaced. Two themes — reducing high levels of soil erosion and
providing water to agriculture in quantities and quality that enhance farm production
— dominated public policy debates about conservation until 1985.
Congress responded repeatedly to these themes before 1985 by creating or
revising programs designed to reduce resource problems on the farm. They
combined voluntary participation with technical, educational, and financial assistance
incentives. By the early 1980s, however, concern was growing, especially among
environmentalists, that these programs were not adequately dealing with
environmental problems resulting from agricultural activities (especially off the
farm). Publicized instances of significant problems, especially high soil erosion rates
said to rival the dust bowl era, increased awareness and intensified the policy debate.
Congress responded, in a watershed event, by enacting four major new
conservation programs in the conservation title of the Food Security Act of 1985
(P.L. 99-198). One of these programs, the Conservation Reserve Program (CRP),
greatly increased the federal financial commitment to conservation and targeted
federal funds at some of the most severe problems by retiring land under multi-year
contracts. The other three, Sodbuster, conservation compliance, and Swampbuster,
created a new approach to conservation by halting producer access to many federal
farm program benefits if they did not meet conservation program requirements for
highly erodible lands and wetlands. Three of these four programs (all except
Swampbuster) addressed soil erosion.
Provisions enacted in the next farm bill, the Food Agriculture, Conservation and
Trade Act of 1990 (P.L. 101-624), reflected a rapid evolution of the conservation
agenda, including the growing influence of environmentalists and other non-
agricultural interests in the formulation of conservation policy, and a recognition that
agriculture was not treated like other business sectors in many environmental laws.
Congress expanded this agenda to address groundwater pollution, water quality, and
sustainable agriculture, and allowed for the use of easements, as well as amending
existing programs. Amendments to the CRP reflect these changes; its earlier focus
on highly erodible land (and on stabilizing land prices) has been adjusted, especially
in the 1990 farm bill, to give greater emphasis to environmental concerns.

After congressional party control switched in 1994, conservation policy
discussions turned to identifying ways to make the conservation compliance and
Swampbuster programs less intrusive on farmer activities. This switch also appeared
to reduce the influence of environmental interests in developing conservation policy.
However, the Federal Agricultural Improvement and Reform Act of 1996 (P.L. 104-
127) included a wide-ranging conservation title. The enacted bill gave considerable

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attention to wildlife, and enacted new programs dealing with farmland protection,
grasslands, and other topics. It also funded many of these new programs as
mandatory for the first time, using the Commodity Credit Corporation as the funding
mechanism.3
The nature of the conservation effort continued to evolve after 1996, as reflected
in the provisions of the most recent farm bill, the Farm Security and Rural Investment
Act of 2002 (P.L. 107-171). Conservation themes in this farm bill included (1)
increasing overall funding; (2) creating new programs and addressing new issues; and
(3) providing more conservation on lands in production (called working lands),
primarily through the new Conservation Security Program. One factor that influenced
the decision to provide more funding was the large backlog of interested and
qualified applicants who could not participate because of insufficient funds. A new
factor in this farm bill was considering how funding for farm programs generally, and
conservation specifically, could be used to meet world trade obligations.4
Current Major Conservation Activities
USDA’s conservation efforts have centered in recent years on implementing the
Conservation Reserve Program (CRP), wetland protection programs, the
Environmental Quality Incentives Program (EQIP), and the Conservation Security
Program (CSP), and on providing technical assistance. Funding for the overall
conservation effort will have grown much larger by the end of FY2007, when many
of the farm bill programs authorized in the 2002 law expire. General trends in policy
for the suite of conservation programs between 2002 and 2007 include less emphasis
on land retirement and on land producing row crops, and more attention to
conservation on land in other agricultural uses and to livestock producers.
Recognizing this expanding effort, Congress in the 2002 farm bill required the
Secretary to submit a report to both agriculture committees (with implementing
recommendations) by December 31, 2005, about how to better coordinate and
consolidate conservation programs; that report was delivered in July 2006.5
Lead conservation agencies continue to be the Natural Resources Conservation
Service (NRCS), which provides technical assistance and administers most programs,
and the Farm Service Agency (FSA), which administers the most expensive current
program, the CRP. These agencies are supported by others in USDA that supply
research and educational assistance, including the Agricultural Research Service, the
3 For an overview of conservation provisions in the 1996 farm bill, see CRS Report 96-330,
Conservation Provisions in the Farm Bill: A Summary, by Jeffrey Zinn.
4 For detailed information about the enacted provisions in the farm bill’s conservation title,
including how they compare with prior law, see CRS Report RL31486, Resource
Conservation Title of the 2002 Farm Bill: A Comparison of New Law with Bills Passed by
the House and Senate, and Prior Law, by Jeffrey A. Zinn.
5 U.S. Department of Agriculture, Reform and Assessment of Conservation Programs: A
Report to Congress, submitted July 10, 2006.

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Forest Service, and the Economic Research Service.6 In addition, the conservation
effort involves a very large array of partners, including other federal agencies, state
and local governments, and private organizations, among others, who provide funds,
expertise, and other forms of assistance to the conservation effort.7
Conservation Reserve Program (CRP)
Under the CRP, producers can bid to enroll highly erodible or environmentally
sensitive lands into the reserve during signup periods, retiring it from production for
at least 10 years. Successful bidders receive annual rental payments and cost-sharing
and technical assistance. Enrollment can total up to 39.2 million acres; however, it
is limited to 25% of the crop land in a county. Funding is mandatory spending.8
FSA’s summary of participation through November 2006 shows more than 36.7
million acres were enrolled, with more than 4 million acres in Texas and almost 3.5
million acres in Montana.9 Under the 2002 farm bill provisions, only land that was
cropped in four of six years preceding enactment is eligible, thus making it more
difficult to cultivate land primarily to gain access to the program. It made a six-state
pilot program to retire small, isolated farmable wetlands into a national program,
with an enrollment ceiling of 1 million acres. Some economic uses of enrolled lands
are permitted for the first time under the 2002 farm bill, in return for a reduction in
annual rental payments.
In August 2005, Secretary of Agriculture Johanns announced that USDA would
offer opportunities to reenroll or extend contracts involving more than 28 million
acres of land where current contracts expire between 2007 and 2010. Priority for
reenrollment was based on the relative ranking of the land using the Environmental
Benefits Index, with additional credit being given for land located in any of five
national priority areas or areas of significant adverse water quality or habitat impacts.
Contracts were offered in five groups. Land in the highest ranked group was
reenrolled for 10 years (with 15 years for restored wetlands), using updated market
rental rates to reflect changes in local market conditions. Land in the other four
groups received contract extensions at existing rental rates, with the second highest
group receiving five-year extensions and the lowest group receiving two-year
extensions. FSA announced on January 31, 2006, that it had started this process for
contracts expiring in 2007 (and also that it would hold a general signup in the spring
of 2006). On June 5, 2006, it reported that it had reenrolled 13 million of the 15.5
6 For background information on the suite of current conservation programs administered
by NRCS and FSA, see CRS Report RL32940, Agriculture Conservation Programs: A
Scorecard, by Jeffrey Zinn.
7 One of many recent examples of such partnerships is the November 8, 2006 announcement
of a partnership with the Defense Department to promote land conservation near military
bases.
8 Mandatory spending means that funding levels (or for this program, acreage enrollment
levels) are authorized for each year in the 2002 farm bill and provided through the
borrowing authority of the Commodity Credit Corporation, with no annual appropriation
required.
9 Information on the CRP, including announcements and enrollment statistics, can be found
at [http://www.fsa.usda.gov/daft/cepd/crp.htm].

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million acres with contracts that were set to expire in 2007, and also accepted 1
million acres in new enrollments from the 1.4 million acres that were offered. FSA
has yet to announce that it has completed the entire reenrollment/extension process.
USDA has estimated that the average erosion rate on enrolled acres has been
reduced from 21 to less than 2 tons per acre per year. Retiring these lands also
expanded wildlife habitat, enhanced water quality, and restored soil quality. The
annual value of these benefits has been estimated from less than $1 billion to more
than $1.5 billion; in some regions where participation is most concentrated, estimated
benefits exceed annual program costs, which have averaged about $50 per acre per
year. However, the Government Accountability Office (GAO) and others have
criticized the potentially ephemeral nature of these benefits, because the landowner
is under no obligation to retain them after contracts expire, although they must follow
a conservation plan on any previously enrolled highly erodible land to retain
eligibility for many types of farm program payments.
In addition to general signups, FSA has enrolled more than 3.5 million acres
under several more targeted options. These acres, which count against the overall
enrollment cap of 39.2 million acres, can be enrolled continuously because they are
presumed to provide large environmental benefits. The three largest and oldest
options, all authorized in legislation, are:
! Enrolling portions of fields with especially high environmental
values. Through November 2006, more than 2.6 million acres had
been enrolled, with more than 465,000 acres in Iowa. The most
common conservation practice at these sites is buffer strips along
water bodies.
! A state-initiated enhancement program (Conservation Reserve
Enhancement Program, or CREP) under which states contribute
funds so that higher rents can be offered to potential participants in
specified areas where benefits will be concentrated. For example,
Maryland, the first state to implement a CREP, is enrolling stream
buffers, restored wetlands, and highly erodible lands along streams
in a portion of the Chesapeake Bay watershed. Currently, 26 states
have one or more approved enhancement programs (3 states have
more than one program), and requests are pending from several
additional states. FSA data show that more than 890,000 acres had
been enrolled through November 2006.
! A program to enroll up to 1 million acres of small, isolated farmable
wetlands. USDA offers signup bonuses to attract participation.
Almost 160,000 acres had been enrolled through November 2006,
with more than 71,000 of those acres in Iowa.
Other newer options, all established through administrative actions by USDA,
include enrolling up to 500,000 acres of floodplains to be planted to hardwood trees,
with allotments specified for states; enrolling up to 250,000 acres of field boarders
for northern bobwhite quail habitat; and creating up to 250,000 acres of wetlands in
non-floodplain areas. A new emergency forestry conservation program enacted in
supplemental appropriations in the wake of Hurricane Katrina under which FSA
estimates that 700,000 acres will be restored.

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NRCS provides technical assistance in support of CRP, but the 1996 farm bill
placed a cap on funding from the CCC that can be used to reimburse agencies for
services provided to deliver CCC programs. These funds have been insufficient to
pay all related technical assistance costs in recent years, and in FY1999, NRCS
briefly suspended CRP-related activities. NRCS now has a line item in its budget for
this purpose and received $76.4 million for FY2006. Congressional efforts to
provide adequate technical assistance funding are discussed in the subsection titled
“Technical Assistance,” below.10
Wetlands and Agriculture
Swampbuster and the Wetlands Reserve Program (WRP) have been the main
agricultural wetland protection programs. (A 1 million acre program for small,
isolated farmable wetlands, added to the CRP in the 2002 farm bill, is discussed
above.) Under Swampbuster, farmers who convert wetlands to produce crops lose
many federal farm program benefits until the wetland is restored. Swampbuster
includes several exemptions from loss of benefits, such as any wetland conversion
that was initiated prior to December 23, 1985 (the date of enactment), or a wetland
that is created as a result of adjacent development. It allows a partial penalty,
meaning that fewer benefits are lost, once a decade.
Swampbuster has been controversial since it was first enacted in 1985. Some
from the farm community view wetland protection efforts on agricultural lands as too
extensive or overzealous. They observe that it protects some sites that appear to
provide few of the values attributed to wetlands. A portion of this group also view
these efforts as an unacceptable intrusion of government into the rights of private
property owners, or “takings.” Environmental and other groups counter that the
Swampbuster program has been enforced weakly and inconsistently, with few
violators losing farm program benefits. Controversies also arise over inconsistencies,
such as when adjoining states use different interpretations of rules that lead to
different determinations.
The only provision in the 2002 farm bill amending Swampbuster addressed a
concern raised by the farm community by prohibiting USDA from delegating the
authority to make wetland determinations to other parties. This concern was thought
to have been addressed when a Memorandum of Agreement (MOA) making NRCS
responsible for all federal wetland determinations on agricultural lands under
Swampbuster (and the Clean Water Act’s Section 404 Program) was signed by
NRCS, the U.S. Army Corps of Engineers, the U.S. Fish and Wildlife Service, and
the U.S. Environmental Protection Agency (EPA) in 1994. But these agencies have
been unable to revise the MOA to reflect changes in the 1996 farm bill, and the
participating agencies have ended their discussions.
An additional issue for agriculture was raised in January 2001 when the
Supreme Court determined, in Solid Waste Agency of Northern Cook County
(SWANCC) v. U.S. Army Corps of Engineers (531 U.S. 159 (2001)), that the Clean
Water Act’s Section 404 wetland permit program should not apply to certain
10 For more information on CRP, see CRS Report RS21613, Conservation Reserve
Program: Status and Current Issues, by Tadlock Cowan.

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“isolated waters.” One result is that an estimated 8 million acres of agricultural
wetlands that had been subject to the Section 404 program will now be subject only
to Swampbuster. Some of these wetlands (up to 1 million acres) may be enrolled in
the new farmable wetland component of the CRP.11 The Supreme Court recently
issued decisions on two cases that will likely result in further adjustments to the reach
of the Section 404 program.12

The second wetlands program, the WRP, was established in the 1990 farm bill.
It uses permanent and temporary easements and long-term agreements to protect
farmed wetlands. Enrollment reached almost 1.75 million acres by September 30,
2005, and more than 150,000 acres were enrolled during FY2006. Permanent
easements account for more than 80% of the total, and have been perfected on 1.37
million acres. The Secretary has the option of delegating the administration of
easements to other federal or state agencies with the necessary expertise. Section
2201 of the 2002 farm bill reauthorized the WRP through FY2007 and increased the
enrollment cap to 2,275,000 acres, while limiting enrollment to 250,000 acres per
year. Funding is mandatory through the CCC. The Office of Inspector General
released an audit report in 2006 which found that “unwarranted payments” had been
made because of lax controls and poor appraisals.
On June 29, 2004, USDA announced a partnership initiative in Nebraska,
modeled after the CREP component of the CRP, to enroll almost 19,000 acres. This
may be a prototype for future initiatives. Another recent initiative taken
administratively will be used to create 250,000 acres of wetlands in non-floodplain
areas (see the CRP discussion, above).13
Environmental Quality Incentives Program (EQIP)
EQIP encourages farmers to participate in conservation efforts by paying a
portion of the cost of installing or constructing approved conservation practices.
EQIP is a mandatory spending program which supports structural, vegetative, and
land management practices. Under provisions in the 2002 farm bill, annual funding
was authorized to increase from $200 million in FY2002 to $1.3 billion in FY2007,
with 60% of the funds each year to be used to address the needs of livestock
producers. The Deficit Reduction Act of 2005 (P.L. 109-171) extended the
authorization through 2010, and delays funding it at $1.3 billion until 2010 (with
somewhat lower levels through FY2009) to create savings in the intervening years.
The total of all EQIP payments that a single entity can receive, combined, is
$450,000 during any six-year period. Contracts can be 1 to 10 years in length. A
conservation plan is required to participate. Producers with comprehensive nutrient
11 For more information on this decision, see CRS Report RL30849, The Supreme Court
Addresses Corps of Engineers Jurisdiction Over “Isolated Waters”: The SWANCC
Decision, by Robert Meltz and Claudia Copeland.
12 For background on these two cases, see CRS Report RL33263, The Wetlands Coverage
of the Clean Water Act Revisited: Rapanos and Carabell.
13 For more information about wetlands, see CRS Report RL33483, Wetlands: An Overview
of Issues, by Jeffrey Zinn and Claudia Copeland.

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management plans (one type of conservation plan) are eligible for incentive
payments, and producers receiving funding for animal waste manure systems must
have these plans. cost-share assistance can be a higher percentage for beginning and
limited resource producers. The implementing regulations list four national priorities
that guide decisions about which producers receive assistance and help optimize
environmental benefits from this program. NRCS gathered public comments about
whether these priorities should be altered at a national listening session on May 5,
2005 (and at state listening sessions), and some of the ideas that were offered may
be a part of future farm bill proposals.14
Three new subprograms were authorized under EQIP in 2002. First, a portion
of EQIP funds in FY2003 through FY2006 can be used to make grants for innovative
efforts, such as fostering markets for nutrient trading. In FY2004, NRCS awarded
$14.5 million to 41 entities; in FY2005, it awarded about $19 million to 103 entities;
and in FY2006, it awarded almost $20 million for 66 projects in 38 states. A call for
proposals in FY2007 was announced on December 4, 2006; they must be submitted
by February 2, 2007. Second, additional funds, starting at $25 million in FY2002
and growing to $60 million annually between FY2004 and FY2007, are provided for
a new ground and surface water conservation program within EQIP. In FY2002,
funds were provided to eight states that are located on top of the high plains aquifer.
The program has expanded each year since, primarily to areas suffereing from
drought and water shortages. According to the NRCS, it has been used to enroll
more than 1.5 million acres under more than 5,000 contracts, and obligations have
totaled more than $130 million.15 Third, an additional $50 million is earmarked for
the Klamath River basin in Oregon and California, and was to be provided as soon
as possible; by the end of FY2004, almost the entire authorized amount ($44 million)
had been made available to complete irrigation management plans on more than
37,000 acres and apply conservation practices on almost 85,000 acres.
Interest in participating in EQIP continues to far exceed available funds, even
with the large increases in authorized amounts. For FY2006, NRCS reported that it
received more than 74,000 applications, but was only able to sign some 41,000
contracts, which provided a total of $788 million in financial assistance. The
remaining almost 33,000 applications that would have provided $636 million in
financial assistance could not be funded.16
14 The Government Accountability Office reviewed how EQIP funds are allocated among
states in a recent report. This process has been criticized, especially by those from states
who believe they should be receiving a higher allocation. See Government Accountability
Office, Agricultural Conservation: USDA Should Improve Its Process for Allocating Funds
to States for the Environmental Quality Incentives Program, September 2006, GAO-06-969.
15 NRCS and FSA produce fact sheets that briefly describe their programs; these fact sheets,
reached on the “programs” page on the NRCS website and on the “conservation” page on
the FSA website, are written primarily to inform potential program participants. The NRCS
website for programs is [http://www.nrcs.usda.gov/programs], and the website for FSA
programs is [http://www.fsa.usda.gov/dafp/cepd/epd].
16 Unfunded applications include those that were preapproved, deferred, eligible, pending,
and disapproved. For further information on EQIP, see CRS Report RS22040,
(continued...)

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Conservation Security Program (CSP)
Section 2001 of the 2002 farm bill authorized the new Conservation Security
Program (CSP) to provide payments to producers on all agricultural land that was
cropped in four of six years before 2002. Payments are based on which of three
levels of conservation is planned for and practiced. The lowest level allows contracts
of five years and annual payments up to $20,000; the middle level allows contracts
of 5 to 10 years and annual payments up to $35,000; the top level allows contracts
of 5 to 10 years and annual payments up to $45,000. The lowest level requires a plan
that addresses at least one resource concern on part of a farm; the middle level
requires a plan that addresses at least one resource concern on the entire operation,
and the top level requires a plan to address all resource concerns on the entire
operation.
Implementation has proven controversial, as the authorizing legislation created
this program as a true entitlement, but appropriators prohibited funding in FY2003,
then limited available funding each year subsequently. As a result, CSP has been
growing, but much more slowly than proponents would like. Estimated funding in
FY2007, for example, is $342 million, an increase of $83 million from FY2006.
NRCS has responded to these funding constraints in the way that it has implemented
the program. It issued an interim final rule on June 21, 2004, allowing it to expand
or contract new participation each year by limiting signups to producers in designated
watersheds. Based on this rule, it enrolled nearly 2,200 producers in 18 eligible
“priority watersheds” in its first year, 2004. After three years of implementation, the
program has more that 19,000 participants in 280 watersheds. In these watersheds,
about 14.6 million acres has been enrolled in the program. This program has another
component new to the conservation effort; it requires interested producers to
complete an extensive self-assessment to determine their eligibility, the first time it
has required this amount of work from producers interested in enrolling in
conservation programs, as a prerequisite to determining whether they will be
accepted.17
Congress has repeatedly capped CSP funding, most recently in reconciliation
legislation enacted February 8, 2006 (P.L.109-171), where funding was capped at a
total of $1.954 billion from FY2006 through FY2010, and at $5.65 billion from
FY2006 through FY2015. The budget resolution that currently guides FY2007
spending would provide only enough funding to support existing contracts; no
additional enrollment would occur. This action generated complaints from program
16 (...continued)
Environmental Quality Incentives Program (EQIP): Status and Issues, by Carol Canada and
Jeffrey Zinn.
17 The GAO issued a report in April 2006 in which it found that some producers were
receiving payments through multiple conservation programs for a practice. The program is
titled Conservation Security Program: Despite Cost Controls, Improved USDA Management
is Needed to Ensure Proper Payments and Reduce Duplication with other Programs (GAO-
06-312).

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CRS-10
supporters, who view the current funding situation as being at odds with the
entitlement that was envisioned in 2002.18
Technical Assistance
NRCS provides technical assistance (TA) at the request of the landowner to
conserve and improve natural resources. TA includes professional advice on how to
design, install, and maintain land management, vegetative, and structural practices
that provide conservation benefits. NRCS combines that advice with knowledge of
local conditions. TA is a component of most conservation programs, and NRCS
estimates that the cost of providing it in FY2005 amounted to about $1.45 billion.
Almost $1.0 billion of this total came from discretionary accounts. Two issues
associated with technical assistance have been whether NRCS has the capacity to
meet the growing demand as funding for programs increases, and how technical
assistance costs should be funded for mandatory programs.
Section 2701 of the 2002 farm bill allows NRCS to augment the technical
assistance capacity of the agency by allowing producers to use approved third parties
to provide this assistance. In the June 7, 2006, oversight hearing, NRCS Chief Bruce
Knight testified that more than 2,500 applications to perform these services had been
approved. These people had provided the equivalent of 520 staff years of support
between 2003 and 2006, at a cost of $163.5 million to the agency.
A subsection of Section 2701 of the 2002 farm bill provided that technical
assistance in support of each mandatory program come from the funding provided by
the CCC for that program. However, the Office of Management and Budget,
supported by the Department of Justice, issued an opinion in late 2002 that technical
assistance funding for mandatory programs remains limited under a cap that has been
placed in Section 11 of the CCC charter under prior law. Many in Congress had
thought that the language in the 2002 farm bill had resolved this issue, and they were
supported in this conclusion by a GAO opinion.
The Administration proposed in its FY2003, FY2004, and FY2005 budget
requests to address this limit by creating a new farm bill technical assistance account,
to be funded through annual appropriations. Congress rejected these proposals. In
FY2003 and FY2004, Congress prohibited using any of the discretionary funds from
Conservation Operations for technical assistance to implement any mandatory
programs. This prohibition, combined with a retention of the cap on CCC funds that
can be spent on administrative expenses, meant that some of the mandatory programs
donated funding for technical assistance to other programs, thereby leaving less
money available to implement “donor program” activities.19 In P.L. 108-498 (S.
18 For more information, see CRS Report RS21739, The Conservation Security Program
in the 2002 Farm Bill, by Tadlock Cowan; and CRS Report RS21740, Implementing the
Conservation Security Program, by Tadlock Cowan.
19 For example, in FY2003, the EQIP was authorized at $695 million. Of that total, $145
million was to be spent on TA, leaving $550 million for cost-sharing assistance to
producers. But EQIP was a donor program because an additional $107 million was diverted
(continued...)

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CRS-11
2856), enacted December 23, 2004, Congress amended the 1985 farm bill to require
that technical assistance for each mandatory program be paid from funds provided
for that program annually, and that funding for technical assistance cannot be
transferred among the mandatory funded programs, starting in FY2005.
Other actions related to technical assistance may also attract congressional
interest. A GAO report, released in November 2004, might contribute to discussions
about the cost of providing technical assistance, which critics state is too high and
reduces the amount of money available for program participants.20 Second, in
February 2005, NRCS announced new policy guidance for technical assistance that
will establish national priorities. For FY2006, these priorities center on helping
producers comply more easily with environmental regulatory requirements. Third,
in September 2005, NRCS announced that it would initiate a new pilot program for
conservation planning in nine states, using a land-owner self-assessment process.
This assessment process appears to follow the process developed for producers who
are interested in participating in the CSP, and wish to determine their eligibility.
Selected Other Conservation Activities
Federal conservation efforts include many additional activities and programs.
The list below includes only selected conservation activities in USDA that are
administered by NRCS and FSA.21 Other USDA agencies that make significant
contributions to the conservation effort include the Agricultural Research Service,
the Economic Research Service, and the Forest Service. Also, none of the many
other conservation programs that have been authorized but are not being
implemented are included here.
Watershed Programs. NRCS has worked with local sponsors for more than
50 years to construct more than 10,500 structures to prevent floods, protect
watersheds, and control erosion and sediments, among other things, under two
authorities, P.L. 534 and P.L. 566. Projects continue to be constructed under both
authorities, although at a slower pace, as appropriations have remained relatively
constant or declined in recent years. An Emergency Watershed Program responds
to emergencies created by natural disasters (see discussion of “Emergency
Conservation Programs,” below). Funding varies greatly from year to year, and is
provided in supplemental appropriations. Over the past decade, funding has averaged
$131 million per year, but in FY2005 it was $354.5 million.
19 (...continued)
from the program to pay for TA in other mandatory conservation programs, leaving $442
million for cost-sharing assistance for producers. Other donor programs in FY2003 included
the Farmland Protection Program, the Grasslands Reserve Program, and the Wildlife Habitat
Incentives Program; they contributed a total of just over $50 million.
20 Government Accountability Office, USDA Should Improve Its Methods for Estimating
Technical Assistance Costs, November 2004 (GAO-05-58).
21 General program information for the NRCS programs can be found at [http://www.nrcs.
usda.gov/programs], and for the FSA programs, general program information can be found
at [http://www.fsa.usda.gov/dafp/cepd/epd]

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CRS-12
A rehabilitation program for aging small watershed structures that are reaching
or have exceeded their design life was enacted in the Small Watershed Rehabilitation
Amendments of 2000 (Section 313 of P.L. 106-472). Section 2505 of the 2002 farm
bill authorized both mandatory and discretionary funding for the rehabilitation
program; mandatory funding rises from $45 million in FY2003 to $65 million in
FY2007, and discretionary funding can be as large as $45 million in FY2003 and
grow up to $85 million in FY2007. To date, appropriators have not provided any of
the mandatory funds and have provided only a portion of the discretionary funds.
The law permits federal funds to pay for 65% of rehabilitation projects, with the
remainder coming from local sponsors. Through FY2005, 132 rehabilitation projects
in 22 states had been initiated and 47 dams had been rehabilitated.
Conservation Compliance and Sodbuster. Under conservation
compliance and Sodbuster provisions, established in the 1985 farm bill, producers
who cultivate highly erodible land (HEL) are ineligible for most major farm program
benefits, including price supports and related payments. These benefits are lost for
all the land the farmer operates. A smaller penalty can be imposed on producers once
every five years if circumstances warrant. Producers who cultivate highly erodible
land using an approved conservation plan are not subject to conservation compliance.
Section 2002 of the 2002 farm bill prohibited USDA from delegating authority to
other parties to make highly erodible land determinations. Any person who had HEL
enrolled in the CRP has two years after a contract expires to be fully in compliance.
According to 1997 data compiled by NRCS, producers were actively applying
plans on more than 97% of the tracts of land that were reviewed. NRCS estimates
that soil erosion on these acres is being reduced from an average of 17 tons per year
to 6 tons per year. Critics, primarily from the environmental community, have
contended that USDA staff has not vigorously enforced these requirements, and cite
a recent GAO report to support some of their contentions.22 Others, primarily from
the agriculture community, have countered that the department has been too vigorous
at times.
Resource Conservation and Development (RC&D). RC&D provides
a framework for local interests to work together to improve the economy,
environment, and living standard in multi-county areas through RC&D Councils that
develop and implement plans. USDA provides technical and financial assistance to
councils, and helps them secure funding and services from other sources. Projects
are implemented to improve natural resources, address waste disposal needs, foster
economic development, and address other similar needs. According to NRCS, 375
areas encompassing more than 85% of the counties in the country have been
designated. This total includes the 7 most recent additions that were accepted from
28 applications during the summer of 2003; at the start of FY2006, an additional 32
applications were pending. Section 2504 of the 2002 farm bill permanently
reauthorized the program and made numerous technical and updating amendments.
22 Government Accountability Office, USDA Needs to Better Ensure Protection of Highly
Erodible Cropland and Wetlands, April 2003 (GAO-03-418).

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CRS-13
Farmland Protection Program (FPP).23 The 1996 farm bill authorized
USDA to assist state and local governments to acquire easements to limit conversion
of agricultural lands to nonagricultural uses. Section 2503 of the 2002 farm bill
greatly increased mandatory funding from $50 million in FY2002 to a high of $125
million in FY2004 and FY2005. The definition of eligible land was expanded to
include rangeland, pastureland, grassland, certain forest land, and land containing
historic or archeological resources. Land enrolled in the program is subject to
conservation compliance. Certain private nonprofit organizations are made eligible
to receive these funds. Eligible lands must be subject to a pending offer. Through
FY2005, more than $370 million had been obligated to acquire 1,217 easements on
almost 260,000 acres in 41 states. An additional 1,073 easements were pending on
more than 192,000 acres in every state. States where the most funds have been
obligated include Maryland ($26.1 million), Pennsylvania ($22.5 million), and New
Jersey ($21.8 million). Emergency legislation, including additional funding for these
two programs, was attached to the FY2006 appropriation. After that was not enacted,
supporters failed in efforts to attach this funding to other legislation. They are
expected to try again early in the 110th Congress.24
Wildlife Habitat Incentives Program (WHIP). WHIP was authorized in
1996 to use a total of $50 million in mandatory funds allocated to the CRP to provide
cost-sharing and technical assistance for conservation practices that primarily benefit
wildlife. This money was fully allocated in FY1998 and FY1999. Congress
provided $40 million in additional conservation funding beyond authorized levels for
FY2001, and USDA allocated $12.5 million to WHIP. Section 2502 of the 2002
farm bill provided $15 million in FY2002, growing to $85 million annually from
FY2005 through FY2007. It provided that up to 15% of the funding each year could
be used for higher cost-sharing payments to producers who protect and restore
essential plant and animal habitat under agreements of at least five years. Through
FY2005, more than 3.3 million acres had been enrolled under more than 21,500
agreements.

Emergency Conservation Programs. The two emergency conservation
programs are the Emergency Watershed Program (EWP) administered by the NRCS,
and the Emergency Conservation Program (ECP) administered by the FSA. The
EWP provides technical and cost-sharing assistance for projects that restore land after
flooding and help to protect it from future damage. The ECP provides cost-sharing
and technical assistance to rehabilitate farmland damaged by natural disasters, and
to carry out emergency water conservation measures during severe drought.
Emergency programs are implemented most years when funding is provided in
response to natural disasters.
In the wake of a very busy hurricane season in 2005, and especially Hurricane
Katrina, Congress provided $300 million to the EWP and $199.8 million to the ECP
in Division B, Title I, of FY2006 Defense appropriations (P.L. 109-148, enacted
December 30, 2005). It also created a new Emergency Forestry Conservation Reserve
23 USDA calls this program the Farm and Ranch Lands Protection Program.
24 For more information, see CRS Report RS22656, Farm Protection Program, by Renée
Johnson.

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CRS-14
Program (EFCRP), modeled after the CRP and to be administered within it, and
appropriated $404 million for this effort. In June 2006, Congress passed additional
emergency supplemental funding (P.L. 109-234, enacted June 15, 2006), which
provided an additional $51 million to the EWP and $100 million to the new EFCRP,
as well as making several other changes to improve access to these emergency
programs.
Water Quality Programs and Initiatives. Pollution in ground and surface
waters has emerged as a major issue for conservation policy as more instances of
contamination in which agricultural sources play major roles have been identified.
Specific occurrences that have driven public interest and concern in recent years
range from a very large hog farm waste spill in North Carolina to the Pfiesteria
outbreak and fish kills in portions of the Chesapeake Bay, hypoxic conditions
creating a large “dead zone” in the central Gulf of Mexico, and smaller ones in other
coastal sites such as Chesapeake Bay. Questions are being raised about the extent of
the problems, the severity of the potential threat to human health, the adequacy of
government programs, and the contribution of agriculture. In some cases, producers
may have contributed to contamination even though they followed accepted
agricultural practices. Current agricultural conservation programs that address water
quality concerns center on EQIP, plus the Enhancement Program (CREP) and the
continuous enrollment option under CRP.
EPA announced a final revised rule for managing nutrient wastes from animal
feeding operations, as required under court order, on December 12, 2002. Large
operators are required to develop comprehensive nutrient management plans while
smaller operators are encouraged to develop them.25 Farm interests were generally
pleased because the rule affects fewer producers and costs less when compared with
earlier proposals. On February 27, 2004, NRCS released its National Animal
Agriculture Conservation Framework, which it describes as a blueprint for assisting
livestock and poultry producers with their voluntary efforts to deal with
environmental issues.26
Water quality problems are being addressed not only through the programs
discussed above, including the CSP and the Ground and Surface Water Conservation
Program under EQIP, but also through farm bill programs enacted in 2002, including:
! the Small Watershed Rehabilitation Program amendments enacted
in Section 2505;
! the Agricultural Management Assistance Program, reauthorized in
Section 2501, which provides $20 million annually between FY2003
and FY2007 and $10 million annually thereafter to 15 specified
states that have been chronically underserved by risk management
25 This rule was published in the February 12, 2003, Federal Register, effective April 14,
2003.
26 For more information on this rule, see CRS Report RL31851, Animal Waste and Water
Quality: EPA Regulation of Concentrated Animal Feeding Operations (CAFOs), by Claudia
Copeland.

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CRS-15
programs (subsequent amendments limit conservation funding to
$14 million annually);
! a program for the Great Lakes Basin states enacted in Section 2502;
! a Grassroots Source Water Protection Program, enacted in Section
2502; and
! a program for the Delmarva Peninsula enacted in Sections 2601-
2604.

In addition, USDA released a draft framework for addressing animal agriculture
conservation on September 9, 2003. The framework discusses how USDA can help
producers meet environmental regulatory requirements and promote new
opportunities while sharing knowledge and increasing accountability.
The 108th Congress enacted legislation (P.L. 108-328) authorizing funding for
the New York City Watershed Protection Program through FY2010. This program,
funded primarily by New York City, intensively installs conservation practices on
farms (and funds other actions in response to other types of land use) in watersheds
that provide drinking water to New York City to maintain a level of water quality that
precludes the need to build a very expensive new water treatment plant. The program
requires participation by at least 85% of the farms in the watershed. If that
participation level is not maintained, the city would be required to build a treatment
system, estimated to cost between $5 billion and $8 billion to construct and $200
million to $500 million annually to operate.
Private Grazing Lands Program. A voluntary coordinated technical and
educational assistance program was initially enacted in the 1996 farm bill to maintain
and improve resource conditions on private grazing lands. Section 2502 of the 2002
farm bill reauthorized the program through FY2007 with appropriations of $60
million annually. Appropriators continue to earmark a portion of NRCS’s
Conservation Operations funds for this effort annually, providing $23.3 million for
FY2005 and $27.2 million in FY2006.
Grasslands Reserve Program. Section 2401 of the 2002 farm bill
authorized a new Grasslands Reserve Program to retire 2 million acres under
arrangements ranging from 10-year agreements to permanent easements. The law
permits the delegation of easements to certain private organizations and state
agencies, and provides up to $254 million in mandatory funding. In FY2005, 1,219
applications to enroll almost 385,000 acres were approved; this was 16% of the
applications received. All the authorized funding was allocated by the end of
FY2005.
Healthy Forests Reserve. Title V of the Healthy Forests Restoration Act
of 2003 (P.L. 108-148) established a program from 2004 through 2008 to help
landowners to restore and enhance forest ecosystems using 10-year agreements, 30-
year easements, and easements up to 99 years. Participants are to be able to show
that participation will improve the likelihood that threatened or endangered species
will recover, biological diversity will improve, or additional carbon will be
sequestered. An interim final rule was issued and became effective on May 17, 2006.

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CRS-16
Air Quality Activities. The 1996 farm bill created an interagency air quality
task force in USDA. The task force represented USDA on scientific topics such as
EPA’s proposals to revise National Ambient Air Quality Standards for ground-level
ozone and some particulates in 1997. USDA and EPA cooperate under a
Memorandum of Agreement signed in January 1998. More recently, federal agencies
have been discussing how agricultural practices and programs affect global warming,
especially by sequestering carbon. On March 23, 2005, USDA announced that
NRCS and the National Forest Service would start to track the amount of carbon that
farmers would be sequestering. The 2002 farm bill did not amend air quality
provisions.27
Research and Technical Activities. Many agencies in USDA conduct
research and provide technical support. NRCS, for example, provides basic data
about resource conditions and characteristics through the soil and snow surveys and
the National Resources Inventory (NRI). Data collected for the NRI was used to
determine that total erosion on cropland declined 43% between 1982 and 2003,
according to a June 2006 press release. NRCS also does applied research through the
plant material and technical centers. Other agencies, both within USDA and outside,
conduct basic research that contributes to both understanding the problems that
conservation programs address and how effective these programs are in counteracting
these problems.
Program Evaluation. NRCS initiated the Conservation Effects Assessment
Project (CEAP) in 2003 to quantify the environmental benefits of conservation
practices installed through selected federal agricultural conservation programs.28 The
project, funded at about $8 million annually, is centered on developing approaches,
methodologies, and databases that can produce scientifically credible estimates of
these benefits. It draws from other activities throughout USDA and beyond, from
NRCS’s National Resources Inventory to watershed research conducted by the
Agricultural Research Service and the U.S. Geological Survey in the Department of
the Interior. CEAP has two components, a national assessment and more focused
watershed studies. Limited data from this effort may be available for a 2007 farm bill
debate.29
Other Conservation Programs and Provisions in the 2002 Farm Bill.
In addition to the programs described above, the conservation title of the 2002 farm
bill authorizes and funds several other programs.
27 For more information, see CRS Report 97-670, Agriculture and EPA’s Proposed Air
Quality Standards for Ozone and Particulates, by James McCarthy and Jeff Zinn.
28 NRCS has been releasing a national summary listing fiscal year conservation
achievements in recent years. This summary is limited to numerical totals, such as “applied
conservation buffers on nearly 225,000 acres” in the FY2006 summary, which can be found
on the NRCS website. However, these summaries to provide some sense of the breadth,
scope, and magnitude of NRCS’s conservation effort.
29 For more information, see Soil and Water Conservation Society, Conservation Effects
Assessment Project: Final Report, 2006, 24 pp.

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CRS-17
! Partnerships and Cooperation in Section 2003 use up to 5% of
conservation funding, for both stewardship agreements with other
entities and special projects designated by state conservationists to
enhance technical and financial assistance to address resource
conservation issues.
! Administrative requirements are amended in Section 2004 to
provide incentives to beginning and limited resource producers and
Indian tribes, and to protect the privacy of personal information
related to natural resource conservation programs and information
about National Resources Inventory data points.
! The Agricultural Management Assistance Program is reauthorized
through FY2007 in Section 2501, and provided an additional $10
million (for a total of $20 million) in mandatory funding annually
through 2007.
! A Grassroots Source Water Protection Program is authorized in
Section 2501, with annual appropriations of $5 million through
FY2007.
! A Great Lakes Program for Erosion and Sediment Control is
authorized in Section 2501, with annual appropriations of $5 million
through FY2007.
! Desert Terminal Lakes provisions are authorized in Section 2507 to
require the Secretary to transfer $200 million in mandatory funds to
the Bureau of Reclamation to pay for providing water to at-risk
natural desert terminal lakes; the Bureau may not use these funds to
purchase or lease water rights.
! Matching funds are authorized through FY2007 in Sections 2601-
2604 to demonstrate local conservation and economic development
through a Conservation Corridor Demonstration Program on the
Delmarva Peninsula.
Conservation Funding
Conservation spending combines discretionary spending in six accounts (all
administered by NRCS) and mandatory funding for more than a dozen programs
through the Commodity Credit Corporation administered by NRCS and FSA. This
section summarizes the FY2008 request submitted to Congress on February 5, 2007,
and the FY2007 appropriations. The FY2008 request is based in part on funding
changes that would occur if the Administration’s farm bill proposals were enacted.
FY2007 appropriations are operating under a continuing resolution that expires
February 15, 2007, and Congress is currently considering another resolution that
would extend funding through the end of FY2007.
Funding for emergency conservation programs, discussed in an earlier
subsection and below, is not included in the data compilations for annual
appropriations unless noted, because these programs are almost never funded in these
acts; they are commonly funded in emergency supplemental appropriations acts.
Emergency funding in FY2006 was substantial because of significant and widespread
hurricane damage, totaling more than $1 billion. Additional emergency funding that
had been attached to FY2007 agriculture appropriations and then to other legislation
considered at the end of the 109th Congress has not been enacted.

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CRS-18
FY2008 Appropriations. The Administration request included several
changes for both discretionary and mandatory funds. The largest proposed change
in discretionary accounts is to provide no funding for most of the watershed
programs; more specifically, the Administration requests no funding for Watershed
Surveys and Planning ($6 million in FY2007) or Watershed and Flood Prevention
Operations ($391 million in FY2007), and $6 million for Watershed Rehabilitation
($32 million in FY2007). Much of the Watershed Operations funding in FY2007,
$311 million of the $391 million, was for emergencies, which are funded in
supplemental appropriations, so this decrease could be considered to be much less
than it appears if emergency funding is not a part of the comparison.
Another major proposed reduction in a discretionary account is to reduce
funding in the Resource Conservation and Development Program from $51 million
in FY2007 to $15 million in FY2008. The Administration proposes to consolidate
RC&D program coordinators and alter their work responsibilities, decreasing the
total numbers needed in these positions from 375 to about 50. In each of the past two
years, Congress has rejected Administration proposals to decrease funding; neither
of the prior requests was for as large a reduction as is currently being sought.

The Administration proposes $802 million in new budget authority for the
Conservation Operations account in FY2008, which is a small increase from the
estimated FY2007 amount ($791 million). How this small increase might be
considered when comparing the Administration request for FY2008 to the FY2007
funding level depends on how Congress chooses to treat earmarks in both the
FY2007 budget resolution and in FY2008. Earmarking for Conservation Operations
has been substantial in recent years (more than $126 million in FY2006), but many
earmarks that were in FY2007 appropriations legislation may be eliminated or
reduced if the pending joint budget resolution is enacted in its drafted form.
Among the mandatory conservation programs, the Administration proposes to
increase spending for the Wetlands Reserve Program from $264 million in 2007 to
$455 million in 2008 by raising the enrollment ceiling from 150,000 acres to250,000
acres (which is the maximum annual enrollment currently authorized). No funding
would be provided for four mandatory programs, although the Klamath Basin and
Grasslands Reserve programs will have used their total authorized funding by the end
of FY2007, while funding for the Wildlife Habitat Reserve Program will expire at the
end of FY2007 and no funding would be provided for the Agricultural Management
Assistance Program, which is authorized at $10 million in FY2008. The request does
call for providing $97 million for the Farmland Protection Program, even though
authorization for appropriations expires at the end of FY2007. It also calls for
limiting Conservation Security Program spending to $316 million, and would reduce
budget authority for this program by $80 million over 10 years (FY2006-FY2015).

FY2007 Appropriations. Appropriations for FY2007 are being provided
under a continuing resolution (P.L. 109-383) through February 15, 2007, because a
final bill was not enacted. The FY2007 appropriations process appears to continue
a trend of recent years where Administrations had proposed more substantial
reductions in conservation funding than Congress had been willing to support. The
Senate-reported bill and the House-passed bill (both H.R. 5384) both rejected many
of the Administration’s proposed reductions for discretionary programs. The Senate

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CRS-19
bill reduced discretionary conservation funding by $3.0 million (from $993.4 million
in FY2006 to $990.5 million in FY2007), while the House-passed bill reduced
discretionary funding to $919.6 million, a decline of $73.8 million. The
Administration’s proposal would have reduced funding $204.8 million to $788.6
million. Both bills did agree with some of the requested reductions in mandatory
conservation funding from authorized levels, which would increase by $257 million
to $4.09 billion in FY2007 under current law unless Congress acts to limit funding.
The Administration request would have lowered six programs a total of $435.0
million, while the Senate bill cut a total of $371 million by making reductions to five
programs, and the House bill cut eight programs by a total of $482.8 million.
Discretionary Programs. For Conservation Operations, the Senate provided
$835.3 million, which is more then either the amount provided by the House ($791.5
million) or that requested by the Administration ($744.9 million). It is also a slight
increase from the amount provided in FY2006, $831 million after the rescission.
Both bills identified numerous earmarks, and specified that they be funded in
addition to, rather than as a part of, allocations to states. They both stated that all
earmarks from FY2006 not identified in the report accompanying the bill were not
to be funded in FY2007. Both bills provided level funding for the Watersheds
Surveys and Planning account, $6.0 million, rejecting the Administration’s request
for no funding. Both bills also rejected the Administration request for no funding for
Watershed and Flood Prevention Operations; the Senate bill provided $62.1 million,
while the House bill provided $40.0 million. Both amounts were a reduction from
the FY2006 appropriation of $74.3 million. Both bills provided $31.2 million for the
Watershed Rehabilitation Program, which is the same as in FY2006, and rejected the
Administration request to reduce funding to $15.3 million. They both also provided
level funding for the Resource Conservation and Development Program, $50.8
million, rejecting the Administration request to reduce funding to $26.0 million. The
Senate bill provided $5.0 million to the Healthy Forests Reserve Program, while the
House bill provided no funding; the Administration had requested $2.5 million.
Mandatory Programs. Mandatory programs, excluding the Conservation
Reserve Program, are authorized to increase by $149 million to $2.0 billion in
FY2007. As shown in Table 1, the Senate bill made fewer and generally smaller
reductions to these authorized levels than the House bill, and the House bill agreed
with more of the Administration’s proposed reductions than the Senate bill. The
largest difference was for the Wetlands Reserve Program, where the Senate bill
concurred with the Administration proposal to enroll 250,000 acres, as authorized,
while the House bill limited enrollment to 144,766 acres. As shown in this table as
well, among the larger of the other differences between the bills were funding for the
Environmental Quality Incentives Program and for the Conservation Security
Program. Table 1 compares authorized levels under the 2002 farm bill (as amended
by the Deficit Reduction Act of 2005) with both bills and the Administration request,
and the resulting scorekeeping adjustments.

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CRS-20
Table 1. Reductions in Mandatory Conservation Programs
(dollars in millions, unless noted otherwise)
FY2007 Authorized
FY2007
House Bill
Senate Bill
Level under 2002
Request
(H.R. 5384)
(H.R. 5384)
Program
Farm Bill*
Environmental Quality
$1,270
$1,000
$1,087
$1,031
Incentives Program
Conservation Security Program
$373
$342
$280
$373**
Wildlife Habitat Incentives
$85
$55
$55
$63
Program
Wetlands Reserve Program
250,000 acres
250,000
144,766 250,000 acres
acres
acres
Farm and Ranch Lands
$97
$50
$50
$58
Protection Program
Ground and Surface Water
$60
$51
$51
$54
Small Watershed Rehab.
$65
$0
$0
$0
Program
Ag. Management Assistance
$14
$0
$6
$14
Source: CRS, using Senate Appropriations Committee and Congressional Budget Office data. See also CRS
Report RS22243, Mandatory Funding for Agriculture Conservation Programs, by Jeffrey A. Zinn, for
authorized funding and limits on mandatory conservation programs.
* Figures in the FY2007 authorized column represent how much are currently available, including reductions
made by the Deficit Reduction Act of 2005 (P.L. 109-171).
** Based on CBO scoring, which differs from Administration figures.
Appropriations bills have included reductions in mandatory programs each year,
although they are often different than the Administration request. Starting in
FY2003, the portion of the authorized mandatory funding for conservation that
Congress has allowed has declined each year from the preceding year. It fell from
97.6% of the authorized amount in FY2003 to 87.2% of the total in FY2006. Each
of the mandatory programs is supported by different constituencies who decry
reductions from the funding commitment that was established in the 2002 farm bill;
those who support the reductions point out that overall conservation funding has been
rising rapidly, even after these reductions are taken into account.
2007 Farm Bill
Farm bill considerations are in the formative stages in Congress, where
agricultural leaders have stated that they will attempt to complete the conference on
this legislation by September 30. Congress is growing more active in anticipation of
this debate, with numerous oversight hearings. Most recently, the Senate Agriculture
Committee held an oversight hearing on the Conservation Security Program and
Environmental Quality Incentives Program on January 17, 2007. The House
Agriculture Committee held numerous field hearings to gather farm bill input during
the second session of the 109th Congress, and conservation topics were addressed at
several of them.

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The Administration offered its set of farm bill proposals to Congress on
February 2, 2007. These proposals come out of a process that involved more than 50
listening sessions and the development of broad theme papers. The theme paper on
conservation and the environment, issued in June 2006, identified four “generalized
alternatives”: (1) improve existing conservation programs, (2) provide “green
payments” for land in production to enhance environmental benefits and provide
income support, (3) encourage private sector markets for environmental services, and
(4) expand conservation compliance or establish a standard of care.30 The
Administration is offering 10 proposals for conservation. The Administration
presents each as a recommended solution to a problem. These proposals would cost
an estimated $7.8 billion above current conservation costs. The proposals (and
additional costs) are as follows:
! Consolidate six programs that provide financial assistance to land
owners and producers into a revised Environmental Quality
Incentives Program, and create a new sub-program to deal with
water quality and quantity issues on a regional basis ($4.25 billion).
! Amend the Conservation Security Program to emphasize higher
levels of conservation and expand enrollment from more than 15
million acres today to more than 96 million acres in 10 years ($500
million above the current 10-year baseline).
! Consolidate the three easement programs for working lands into a
single program ($900 million above the current 10-year baseline).
! Increase the focus of a reauthorized Conservation Reserve Program
on environmentally sensitive lands, with priority for lands enrolled
on which biomass crops for energy are produced.
! Increase the Wetlands Reserve Enrollment cap to 3.5 million acres
($2.125 billion).
! Expand conservation compliance to include “sod saver” to
discourage conversion of grasslands into cropland.
! Designate a portion of each conservation program to socially
disadvantaged and beginning producers.
! Encourage the development of new private-sector environmental
markets to supplement and compliment conservation programs ($50
million).
! Repeal legislative language that requires a minimum amount of
conservation funds go to every state.
! Consolidate the two emergency response programs for conservation
into a single program.
Many interests have been discussing what provisions might be considered for
a conservation title in a farm bill in 2007. For each of the many issues addressed in
a farm bill, coalitions are forming and groups are developing their priorities and
positions. The American Farmland Trust, in particular, has been very active in
soliciting input from a wide range of interests and has developed a wide-ranging set
30 For more information on the green payment concept, as well as a comparison of views
about it from the United States and Europe, see CRS Report RL32624, Green Payments in
U.S. and European Union Agricultural Policy, by Charles Hanrahan and Jeffrey Zinn.

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of general proposals, which it released in early summer of 2006.31 The
Administration proposal addresses many of the topics being most widely discussed
at this time. They include (in no particular order) the following.
! How to better integrate conservation efforts with commodity policies
through green payments or by other means.
! Whether conservation funding will continue to grow, and how
conservation funds should be allocated among the many programs
in the future, as well as where (which states and regions) and who
(which producers or problems) should receive higher priority for
access to these programs, what levels of funding are necessary to
successfully deal with the backlog of interest in program
participation, and whether that level of funding should be provided.
! Whether funding for working lands, generally referred to as green
payments and perhaps modeled after the CSP, should be expanded,
both because of the likely need for such a program if trade talks are
successfully concluded (an outcome that is currently in considerable
doubt) and because such an effort would complement the many land
retirement conservation programs.
! How to make energy policies that encourage expanded crop
cultivation for biofuels compatible with land retirement and other
conservation goals.
! How to address issues new to the farm bill or of growing importance
in conservation policy, such as endangered species, invasive species,
and water supplies in the West.
! Whether the federal conservation agencies have the capacity to
deliver programs, and whether they should be expanded to include
new mission areas or receive significant additional funding.
! How to condense and coordinate the plethora of conservation
programs that already exist.
! What role(s) the Bush Administration’s Cooperative Conservation
Initiative and related types of efforts that involve voluntary
partnerships might play in agriculture conservation policy.32
! Whether there are opportunities to use more market-based
approaches in conservation efforts, such as establishing ecosystem
markets or selling carbon credits.
! Whether there are opportunities to apply conservation efforts at
larger scales, such as ecosystems or watersheds.
31 Information on these proposals can be accessed through the American Farmland Trust
website [http://www.farmland.org].
32 More information on this Initiative can be found at [http://cooperativeconcservation.gov].

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