November 13, 2013
OPTIONS FOR REDUCING THE DEFICIT: 2014 TO 2023

Mandatory SpendingOption 2

300 - Natural Resources and Environment

Limit Enrollment in Department of Agriculture Conservation Programs

(Billions of dollars) 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2014-2018 2014-2023
Change in Outlays                        
  Phase out the Conservation Stewardship Program 0 * -0.2 -0.5 -0.7 -0.9 -1.2 -1.4 -1.6 -1.9 -1.4 -8.4
  Scale back the Conservation Reserve Program 0 0 -0.3 -0.4 -0.5 -0.5 -0.7 -0.7 -0.8 -1.1 -1.2 -4.9
  Both of the above policies 0 * -0.6 -0.8 -1.2 -1.4 -1.8 -2.1 -2.4 -3.0 -2.6 -13.3

Notes: This option would take effect in October 2014.

* = between -$50 million and zero.

Under the Conservation Stewardship Program (CSP), landowners enter into contracts with the Department of Agriculture (USDA) to undertake various conservation measures—including ones to conserve energy and improve air quality—in exchange for annual payments and technical help. Those contracts last for five years and can be extended for an additional five years. For every acre enrolled in the CSP, a producer receives compensation for carrying out new conservation activities and for improving, maintaining, and managing existing conservation practices. Current law limits new enrollment in the CSP to about 13 million acres per year, at an average cost of $18 per acre; in 2012, USDA spent $0.9 billion on the program.

Under the Conservation Reserve Program (CRP), landowners enter into contracts to stop farming on specified tracts of land, usually for 10 to 15 years, in exchange for annual payments and cost-sharing grants from USDA to establish conservation practices on that land. One type of tract used in the program is a “conservation buffer”—a narrow strip of land maintained with vegetation to intercept pollutants, reduce erosion, and provide other environmental benefits. Acreage may be added to the CRP through general enrollments, which are held periodically for larger tracts of land, or through continuous enrollments, which are available at any time during the year for smaller tracts of land. Current law caps total enrollment in the CRP at 32 million acres; in 2013, USDA spent $2.0 billion on the roughly 27 million acres enrolled.

The first part of this option would prohibit new enrollment in the Conservation Stewardship Program beginning in 2015. Land currently enrolled—and therefore hosting new or existing conservation activities—would be eligible to continue in the program until the contract for that land expired. By the Congressional Budget Office’s estimates, the prohibition on new enrollment would reduce federal spending by $8 billion from 2015 through 2023.

The second part of this option would prohibit both new enrollment and reenrollment in the general enrollment portion of the Conservation Reserve Program beginning in 2015; continuous enrollment would remain in effect under the option. That prohibition on general enrollment would reduce spending by $5 billion from 2015 through 2023, CBO estimates. The amount of land enrolled in the CRP would drop to about 10 million acres by 2023.

One argument for prohibiting new enrollment in the Conservation Stewardship Program and thus phasing out the program is that some provisions of the program limit its effectiveness. For example, paying farmers for conservation practices they have already adopted may not enhance the nation’s conservation efforts. Moreover, the criteria used by USDA to determine whether improvements in existing conservation practices have been made are not clear, and the absence of such objective measurements could result in higher payments than necessary to encourage the adoption of new conservation measures.

An argument against phasing out the CSP is that it may offer a way to support farmers that provides more environmental benefits than traditional crop-based subsidies do. Furthermore, conservation practices often impose significant up-front costs, which can reduce the net economic output of agricultural land, and CSP payments help offset those costs.

One argument for scaling back the Conservation Reserve Program is that the land could become available for other uses that would provide greater environmental benefits. For example, reducing enrollment could free up more land to produce crops and biomass for renewable energy products.

An argument against scaling back the CRP is that studies have indicated that the program yields high returns—in enhanced wildlife habitat, improved water quality, and reduced soil erosion—for the money it spends. Furthermore, USDA plans to enroll only the most environmentally sensitive land in the CRP in the future, perhaps thereby providing an especially cost-effective way to protect fragile tracts.