Ag Policy Blog
Chris Clayton DTN Ag Policy Editor

Wednesday 10/09/13

Lucas Makes Case on Conservation Compliance

OMAHA (DTN) -- House Agriculture Committee Chairman Frank Lucas took time Wednesday to issue a statement praising the American Farm Bureau Federation board of directors for opposing language in the Senate farm bill that ties conservation compliance to crop-insurance premium subsidies.

Lucas, a Republican from Oklahoma, issued the statement late Wednesday afternoon. I reached out to AFBF staff about the board's action but did not get an immediate response. DTN Political Correspondent Jerry Hagstrom reported AFBF's board took the vote last week. Farm Bureau had been part of a coalition of a farm and conservation groups that backed the Senate's language on conservation compliance.

The statement lays down a marker for Lucas that the battle over conservation compliance is important enough to highlight a position taken by a major farm group even though AFBF didn't issue a statement on its board's actions.

Lucas calls the efforts to tie minimum conservation standards to crop insurance a "misguided and redundant regulatory burden imposed on farmers and their property rights. I am philosophically opposed to this linkage and applaud AFBF's decision to support this position."

Lucas said he supports the current conservation compliance standards, as well as voluntary USDA conservation programs. Lucas noted he shared concerns of the AFBF board over how inconsistent such provisions are enforced.

Farm groups, environmentalists and conservationists have been battling over the prospect of tying conservation compliance to eligibility for the crop-insurance premium subsidy throughout the farm-bill process. The argument for doing so is that the commodity program is losing its luster because commodity payments will be smaller in this farm bill. The safety net continues to shift to crop insurance.

Jim Moseley, a former USDA deputy secretary in the George W. Bush administration, released a report with American Farmland Trust, "Conservation Compliance: A 25-Year Legacy of Stewardship." Moseley wrote in the report that he was concerned about conservation losing ground. "As Congress reauthorizes the farm bill, it is critical that the conservation gains that have been made over the last 25 years be maintained by reattaching the crop insurance premium assistance to conservation compliance."

Last year, the Senate approved an amendment to its version of the farm bill that would require conservation compliance to be eligible for the crop-insurance subsidy. When the Senate passed its farm bill earlier this year, the Senate kept the language. The House Agriculture Committee declined to add similar language to its bill.

Lucas stated Wednesday, "Crop insurance is not a traditional benefit to producers. A grower must purchase a crop insurance policy and must suffer a verifiable loss. Sometimes this means a grower must suffer a 50% loss before collecting a payment. Tying conservation compliance to crop insurance would create another layer of bureaucratic, red-tape potentially endangering a farmer's livelihood. This is during a time when USDA is already overwhelmed with determining wetland designations for producers who are subject to compliance."

Conservation compliance was begun in the 1985 farm bill as a way to reduce the effects some USDA programs were having on encouraging farming on vulnerable land. Compliance requires farmers to have conservation plans to reduce erosion on highly-erodible land to remain eligible for USDA farm programs and loans. About 25% of U.S. farm ground is considered highly erodible land. ERS has cited that conservation compliance helped reduce erosion on highly-erodible ground by as much as 40% from 1982 to 1997. That amounts to about 295 million tons of soil per year that are protected.

Of the 1million or so people who collect various farm-program payments annually, fewer than 450 farms on average are cited annually for not meeting minimum conservation standards. There are more than 30 states that haven't had a non-compliance case in nearly a decade. Farmers in a handful of Midwest and Plains states make up the lion's share of non-compliance cases every year.

In May, DTN filed a Freedom of Information request with USDA asking for data over the last 10 years on enforcement of conservation compliance. As of June, there was one farmer nationally in 2013 who had been cited for being out of compliance. That producer was in Indiana. No financial penalty had been assigned to the violation.

In 2012, USDA reported 342 violations nationally that initially took away $7.1 million in farm-program payments. But USDA later returned reinstated $5 million of those payments, which means the farmer got back into compliance. USDA ended up with 106 confirmed violations of the highly-erodible land provision and 79 wetland violations.

Also in 2012, all of the cases came from 17 states. Thirty-three states didn't have a single violation. Of the 342 initial findings of non-compliance, 180 of them, of 52% were from Iowa. Another 62 of the cases were from Nebraska, or 18% of the total. Wisconsin had 26 cases and North Dakota had 24. Thus, four states accounted for 85% of all non-compliance conservation cases nationally.

For 2011, USDA found 507 farms cited 507 farms nationally for being out of compliance. Of $10.3 million of potential benefits at risk, farmers eventually lost $1.57 million in payments. The other $8.75 million in farm-program payments were reinstated.

Iowa had 187 non-compliance cases in 2011 or nearly 39% of all cases nationally. North Dakota had 42 cases, Nebraska had 41, Illinois had 39 and South Dakota had 38 and Wisconsin had 15 cases. Those six states accounted for more than 40% of all conservation compliance cases.

2010 saw 304 conservation compliance cases nationally. There ended up being 214 violations. Producers had $8.45 million in payments at risk, but $7.26 million in payments was reinstated.

Yes, the Hawkeye state again led the country in 2010. Iowa had 85 cases, followed by Nebraska and North Dakota with 29 cases and Michigan with 28. Wisconsin and New York each had 17 compliance cases.

In 2009, USDA had 347 non-compliance cases. There were $7 million in payments at risk, but just under $6 million was reinstated. Iowa was the leader with 75 cases. Nebraska had 40 and North Dakota had 30.

Going back a decade, USDA has never had more than 608 cases of non-compliance in any given year. That was 2004. Three times over that decade USDA has taken away roughly $2.1 million and change in farm-program benefits. That happened in 2004, 2005 and 2012.

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Posted at 5:43PM CDT 10/09/13 by Chris Clayton
Comments (5)
Non enforcement is rampant .Anyone getting %60 ins. premium subsidy needs to fulfill his conservation plan which signed years ago.Lucas shame on you.
Posted by melvin meister at 10:32PM CDT 10/09/13
The only thing that this provision appears to do is take away the subsidy, not the program. They can still get insurance. It is just that they have to shoulder the entire load. I think that if you are going to be on corporate welfare from the government, you should have strings attached to getting that welfare. Isn't that what we tell the poor people? They shoudl work, or be looking for work or getting an education. Why should it be any different for farmers in this case? If I am going to subsidize my farmer's crop insurance, I want something back from it.
Posted by Pedro Sanchez at 8:30AM CDT 10/10/13
What exactly is "Conservation Compliance"? What is required? Does anyone know exactly what it is referring to? Pretty vague.
Posted by Glenn BRANDS at 2:16PM CDT 10/10/13
Conservation compliance is similar to the statement of House Speaker, Nancy Pelosi on Obummercare. We must pass this legislation so we can read it. I question if even she was aware, Obama would allow exemptions to big business and government employees. The Eviros will have a hay day with this one.
Posted by Bonnie Dukowitz at 6:55AM CDT 10/13/13
Glen;Conservation Compliance means on all highly erodable land you must control erosion by either terrases or crop residue left on the surface. Farmers signed this plan with FSA and the NRD intheir local county to participate in the farm bill provisions .Some signed just to get Fixed Payments. Enforcement was never applied .Thanks for asking Glen
Posted by melvin meister at 11:33AM CDT 10/14/13
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