Report Finds Rewarding Farmers Based on Real Results Increases Environmental Benefits

CONTACT: Frank Casey, Defenders of Wildlife, 202-772-0227;
George Boody, Land Stewardship Project, 651-653-0618

10/5/07
Reforming conservation programs in the 2007 Farm Bill so they reward farmers based on measurable environmental results would provide increased benefits at a lower cost, concludes a new white paper. Such a “performance-based” system would be in contrast to current working lands agricultural conservation policy, which pays farmers for practices they establish, even when the actual environmental results of such practices are not known, according to the paper, which was produced by the Multiple Benefits of Agriculture Initiative.

“The success of federal and state agricultural conservation programs is measured by how many acres are enrolled in practices like no-till farming, or how much of a watershed is covered in structures like terraces,” said George Boody, a co-author of the paper and Executive Director of the Land Stewardship Project. “Although this practice-based system has produced benefits such as decreased soil erosion, environmental problems such as lower water quality and diminishing wildlife habitat are increasing in severity. We need to base conservation programs on actual performance.”

Boody and co-author Frank Casey, Director of the Conservation Economics Program at Defenders of Wildlife, analyzed farm conservation programs and how farmers are paid for putting in place specific practices. The problem with current agricultural conservation programs, say the authors, is that they pay for practices based on the assumption they will produce benefits without actually measuring the outcomes. Natural resource professionals, farmers and taxpayers in general are increasingly demanding to know what benefits—cleaner water, more wildlife habitat, etc.—are actually being produced by farm conservation programs, which cost billions of dollars annually.

Performance-based systems will likely have several potential benefits, including improved environmental outcomes from conservation efforts at the farm and watershed level, increased cost effectiveness at the farm level and more accountability in the use of public funds, say the paper’s authors. Performance-based systems could provide the data and foundation for new innovative policies such as non-point source trading programs and markets for ecosystem services that result in environmental outcomes.

“Performance-based systems tend to reduce costs and lead to the adoption of conservation practices by farmers because producers have more flexibility for innovation and can find least-cost ways of achieving a defined environmental outcome,” said Casey.

From a taxpayer and public investment perspective, it is better policy to pay on the basis of goals achieved rather than just funding specific practices, Casey added.

“But transitioning into paying for environmental performance will take experimentation and research,” he said. “If public or private markets are going to pay landowners based upon the environmental outcomes they achieve, there must be indicators for measuring the level of environmental performance attained. Currently, too little effort is being focused on developing such indicators.”

The 2007 Farm Bill, which is being hammered out by Congress this fall, holds great potential for beginning the process of creating performance-based conservation policy, say Boody and Casey. For example, the Conservation Security Program (CSP) is the first USDA initiative to provide increased payments for higher levels of resource protection and could be developed as a more performance-based model. CSP includes performance-based components such as minimum conservation standards required to be eligible for program participation, an increased payment level based on the number of “resources of concern” that are addressed, and the availability of enhancement payments that go beyond minimum resource conservation standards. 

“Farmers participate in CSP after they have made significant environmental improvements, thereby reducing costs to taxpayers and protecting water and wildlife habitat when those environmental outcomes continue,” said Casey. “Even better, farmers tend to make continuous improvements beyond the minimum levels covered by the installation of one new practice.”

“But CSP will have little impact unless it is fully funded and reserves its highest payment rates for resource-conserving crop rotations, sustainable grazing systems and other conservation systems with high multiple environmental benefits,” said Boody. “Congress needs to take the first step toward performance-based conservation by fully supporting CSP this fall.”

A copy of “An Assessment of Performance-Based Indicators for Resource Conservation on Agricultural Lands” is available at www.landstewardshipproject.org/mba/performance_based_indicators.pdf or www.defenders.org/publications/pbi_aglands. 

The Multiple Benefits of Agriculture Initiative (www.landstewardshipproject.org/programs_mba.html) studies how diverse cropping, perennial plants and grazing systems affect communities on a watershed level. The Initiative is evaluating tools to predict environmental performance and estimating the economic benefits to taxpayers and farmers when new agricultural policies are implemented.

Founded in 1947, Defenders of Wildlife (www.defenders.org) is one of the country’s leaders in science-based, results-oriented wildlife conservation.

For 25 years, the Minnesota-based Land Stewardship Project (www.landstewardshipproject.org) has been working to foster an ethic of stewardship for farmland, to promote sustainable agriculture and to develop sustainable communities.

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