House farm bill makes key land access investments, but misses big opportunities


NYFC policy staff continues to dig into the House farm bill, H.R. 2. Read our previous posts on the overall analysis of the bill, as well as its potential impact for young farmers in the West.

Across the country, climbing land prices have made it increasingly difficult for farmers to afford land. The challenge of land access for young farmers is so widespread and acute, in fact, that NYFC has an entire team dedicated to it. The farm bill, reauthorized by Congress every five years, can help, or hinder, young farmers’ ability to access land.

On Wednesday, the House Agriculture Committee voted its draft of the 2018 farm bill, H.R. 2, out of Committee on a strictly party-line vote. As the bill heads to debate before the full House, NYFC’s land access team breaks down what its impact might be on farmland access for young farmers.

Here are our main takeaways: The bill increases funding to protect farmland from development through the Agricultural Conservation Easement Program (ACEP), an important gain in keeping land available for farmers. However, the reforms do not include prioritization for projects that ensure the long-term affordability of conserved farmland, which we believe is critical when it comes to serving the needs of young farmers and upholding the purpose of the program. In addition, a number of tweaks to ACEP may dilute the program—taking limited funding away from farmers who wish to conserve their land.

Before we dive in, make sure your Representative knows you care about access to land by being part of NYFC’s Team Farm Bill. Make your voice heard by texting “FARM” to40649 or sign up here.

The Good

  • Funding for the Agricultural Conservation Easement Program (ACEP) is restored to $500 million.
  • Establishes mandatory funding for the Regional Conservation Partnership Program (RCPP) at $250 million per year to allow for more conservation innovation through public-private partnerships.
  • ACEP program administration is improved for conservation organizations and farmers.
  • Changes to the Transition Incentives Program (CRP-TIP) would allow beginning, socially disadvantaged, and veteran farmers and ranchers to prepare for organic certification and planting prior to acquiring land coming out of the Conservation Reserve Program (CRP).
  • Increased data collection around farmland access, tenure, and transition will improve policy making and analysis.

The Not-So-Good

  • ACEP reforms do not include prioritization for projects that ensure the long-term affordability of conserved farmland.
  • Eligible uses of ACEP funds are expanded beyond the purpose and intent of the program, diluting the ability to protect critical farmland.
  • The income cap is eliminated for landowners receiving funds through ACEP, reducing opportunity for less wealthy landowners to compete for limited federal conservation funding.
  • Includes provisions in ACEP allowing mineral development on conserved farmland.
  • Farm Service Agency (FSA) guaranteed operating loan limits are increased without increases in overall loan program funding for FSA, decreasing the opportunity for small-scale and beginning producers to access loans while failing to address needed improvements for land access, such as increases to FSA direct farm ownership loan limits, allowing for pre-qualification, and moving applications online.

Funding for Farmland Conservation

Starting with the good news, we are very glad to see the Agricultural Conservation Easement Program (ACEP), which protects agricultural land from development, restored to $500 million per year in mandatory funding. In 2018, funding for that program was cut in half to $250 million, significantly underfunding farmland conservation efforts as millions of acres of farmland go up for grabs. Consistent funding that farmers and conservation organizations can count on is critical to creating a pipeline of farmland protection projects. Eligible entities need to know that funding will be available as they establish local land conservation priorities and work through complex transactions with landowners. Similarly, farmers need to be assured that funds are available when needed to compensate them for their development rights.

Although increased funding is necessary and encouraging, we would like to see a minimum percentage of ACEP funds dedicated to farmland conservation projects, since both wetland and farmland projects are currently eligible with no guidelines as to how much should be allocated to each. Although both are important, wetland easements typically take up well more than half of projects funded through ACEP, leaving farmland protection struggling to keep pace.

NYFC is also happy to see the Regional Conservation Partnership Program (RCPP) received its own dedicated funding stream. In addition to securing funding for the program, the bill also simplifies the application process, allows for more flexibility in the program, and expedites the process for renewing or extending projects. This program, created in the 2014 Farm Bill, has been a successful source of funding to facilitate public-private partnership and leverage private dollars for conservation projects. An increasing number of land trusts have used this program to take a more comprehensive approach to farmland protection, including projects on farmland transition and access to land.

With nearly 100 million acres of agricultural land expected to change hands over the lifetime of this farm bill, and prime farmland being lost at unprecedented rates, this is a particularly critical moment to ensure landowners know that federal funding for farmland protection is an option to help them keep their land in agriculture. To get the most out of RCPP, organizations should be allowed to receive funding for outreach and technical assistance to landowners, and the program purpose and funding priorities should be modified to include farmland transition and beginning farmers and ranchers.

 

Changes to ACEP and CRP-TIP Improve Programs for Farmers

Continuing with the good news, NYFC was pleased to see that the Agricultural Land Easement (ALE) plan requirement in ACEP has been removed from the minimum deed terms. While we support planning as a means to encourage the best environmental outcomes on farmland, particularly for highly erodible land, the ALE plans have been overly burdensome for land trusts to implement and enforce.

A few additional tweaks to ACEP appear to make the program more farmer-friendly. The bill includes flexibility for allowing non-agricultural uses on conserved farms so long as they do not negatively impact the agricultural operation or conservation values of the property, and also allows landowners to participate in, and receive compensation from, environmental services markets if the purpose is to facilitate additional conservation benefits. Farmers often rely on a mix of income streams to support their overall operations and are leaders in on-farm innovation. At a time when net income is down more than 50% in the last five years, farmers shouldn’t have to choose between farmland protection and farm viability.

In addition, improvements to CRP-TIP would increase the accessibility and usefulness of the program for beginning, socially disadvantaged, and veteran farmers. The proposed changes would make the transition of land that has been enrolled in CRP to an incoming farmer through TIP smoother by allowing that farmer to begin the organic certification process on the property three years prior to acquiring it and to begin preparations for planting the year prior to acquiring the land. There is also a provision for technical and financial service to be provided to the incoming farmer.

Land Access Data Collection

Lastly, two new initiatives could help inch us closer to a more comprehensive approach to land access: the creation of a federal “Commission on Farm Transitions” and a new initiative to collect and report data and analysis on farmland ownership, tenure, transition, and entry of beginning farmers.

ACEP Falls Short on Protecting Affordable Farmland

Now for the not-so-good. Despite the funding increase, the House draft of the farm bill misses an opportunity to address a critical need—prioritizing easements that keep protected farmland in the hands of farmers. Traditional conservation easements funded through ACEP prevent future development and subdivision on conserved land, but stronger easements ensure this land stays in agricultural production. We urge Congress to ensure that the farm bill prioritizes working farm easements with affordability provisions under ACEP. Working farm easements with affordability provisions, such as the Option to Purchase at Agricultural Value (OPAV), protect the long-term affordability of land and keep it in the hands of working farmers. Given the scale of the issue of farmland access and affordability for the next generation of producers, we must ensure that farmland protected with federal funding remains in production and that it will provide rural economic opportunity for working farmers and ranchers for generations to come.

Program Reforms Weaken ACEP Integrity

Unfortunately, the House bill includes some new provisions that undermine the purpose of ACEP and create barriers to young farmers being able to access the program.

  • Diluted funding
    In this draft, ACEP funds may be used to protect land that is 100 percent forested. Forested lands are an important component of many farm systems—think maple syrup production, mushroom cultivation, and logging—and we support increasing the percentage of forested lands allowed in agricultural easements. Allowing 100 percent forested lands to receive funding through ACEP, however, has the potential to take away much-needed funding from productive farmland—under this change, southern pine plantations could compete with Wisconsin dairies for farmland protection dollars. An easement program for completely forested parcels is already authorized in the farm bill and should not be included in ACEP.
  • Program Tweaks Favor Wealthy Landowners
    The House bill diverts limited public conservation funds to wealthy landowners through two changes to ACEP. First, it eliminates the income cap for landowners receiving funds. Second, the bill allows charitable donations from landowners to count towards the 50% match required for federal easement purchases. Although these changes are designed to encourage landowners of prime farmland to enroll in the program, we believe it is a misuse of scarce public funds. Demand for the program currently outpaces available dollars, and incentives already exist in the tax code to encourage wealthier individuals to donate the easement value on their land. With a limited pool of funding, we should prioritize making our dollars work twice as hard—purchasing easements not only protects land from development, but can help support farm viability and transition for farmers with less resources.
  • Allowing mineral development
    Under the proposed ACEP program, mineral development would be allowed on land protected by a conservation easement, potentially opening up protected land to oil and gas drilling and other mineral development. We have heard from some partners that farmers who have already sold their mineral rights wish to participate in the program, and that this change would allow them to do so. Others have responded that previously mineral development was allowed on a case-by-case basis. While we agree that these are important considerations, and farmers often benefit from the ability to remove limited amounts of minerals from their own properties, we have serious concerns about this change, and we believe that publicly-funded conservation easements should maximize conservation benefits to taxpayers. We should be sure that this change serves farmers and taxpayers, rather than outside private interests.

Farm Loans

Our last bit of bad news about land access in the House bill relates to access to credit. Farm Service Agency (FSA) guaranteed operating loan limits were increased without increases in overall loan program funding for FSA. This means that opportunities for small-scale and beginning producers to access loans could be seriously undermined if bigger loans are allowed. We urge Congress to consider much-needed changes to FSA loan programs that would help with access to land, such as: increasing the direct farm ownership loan limit and pegging it to farmland inflation rates; allowing farmers to receive pre-qualification for land ownership loans; and moving the application process online.

…..And that’s our rundown! As this bill now goes before the full House of Representatives, it’s critical that we keep advocating for a better farm bill that young farmers need. Help us do it by becoming part of NYFC’s Team Farm Bill. Make your voice heard by texting “FARM” to 40649 or sign up here.

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