Testimony of the Upper Mississippi River Basin Association

FY 2008 Appropriations for the Department of Agriculture

Submitted to the

House Committee on Appropriations

Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies

March 15, 2007

The Upper Mississippi River Basin Association (UMRBA) is the organization created in 1981 by the Governors of Illinois, Iowa, Minnesota, Missouri, and Wisconsin to serve as a forum for coordinating the five states' river-related programs and policies and for collaborating with federal agencies on regional water resource issues. As such, the UMRBA has an interest in the budget for the U.S. Department of Agriculture's conservation programs and technical assistance.

Of particular importance to the UMRBA is funding for the Conservation Reserve Program (CRP), Wetlands Reserve Program (WRP), Environmental Quality Incentives Program (EQIP), and Conservation Security Program (CSP). Taken together, these four programs provide an invaluable means for the USDA to work with landowners, local conservation districts, and the states to maintain agricultural productivity while protecting the nation's soil and water resources. CRP, WRP, EQIP, and CSP are key non-regulatory elements in the states’ efforts to address agricultural sources of water quality impairment through the Total Maximum Daily Load program and can help address the national concern with hypoxia in the Gulf of Mexico.

Conservation Reserve Program

The UMRBA supports President Bush’s FY 08 budget request of $2 billion for the Conservation Reserve Program, a slight increase over FY 07. Through CRP, farmers and ranchers can voluntarily establish long term conservation practices, such as filter strips and riparian buffers, on highly erodible and environmentally sensitive cropland.

In the UMRBA states (Illinois, Iowa, Minnesota, Missouri, and Wisconsin), total CRP enrollment is currently 7.1 million acres, or approximately 19 percent of the national CRP acreage. Yet the five states’ CRP enrollment represents 41 percent of the total number of CRP contracts, 40 percent of the total number of farms enrolled nationwide in the CRP, and 32 percent of the total annual CRP rental payments. CRP contracts expiring in 2007 cover 2 million acres in the five UMRBA states. Preliminary data indicate that 77 percent of those expiring acres will be re-enrolled or extended.

All five UMRBA states also have active Conservation Reserve Enhancement Programs (CREP) tailored to meet their priority conservation needs. Current CREP enrollment in the five states is over 261,000 acres, or 28 percent of the national total. These rates of participation clearly demonstrate the importance of the CRP and CREP in the nation’s agricultural heartland and reflect the compatibility of these programs with agricultural productivity.

Wetlands Reserve Program

The President’s FY 08 budget proposes $455 million for the Wetlands Reserve Program, an increase of 72 percent over FY 07 spending estimates. UMRBA applauds this substantial increase and the Administration’s goal of enrolling 250,000 acres, bringing the total acres to WRP’s authorized program cap.

WRP easements have proven to be important tools for restoring and protecting wetlands in agricultural areas. This is clearly evident from the overwhelming landowner response and the resulting improvements to water quality and habitat. From FY 92 through FY 06, NRCS has enrolled 2680 contracts in Illinois, Iowa, Minnesota, Missouri, and Wisconsin totaling more than 352,000 acres, or 19 percent of the national total. In FY 06, $56.3 million of WRP funding was allocated to the five Upper Mississippi River states, representing a quarter of all WRP investment that year. Yet the future viability of WRP is in question as a result of the 2006 change in the way USDA appraises property for WRP easements. The new “Yellow Book” appraisal system has resulted in lower price-per-acre offers, making enrollment in WRP less attractive for many landowners and potentially leading to enrollment of less environmentally valuable lands. UMRBA is concerned that WRP target the most ecologically valuable wetland areas and thus urges Congress and USDA to evaluate the impacts of the new WRP appraisal system and take action to maintain the program’s future effectiveness.

Environmental Quality Incentives Program

In contrast to conservation programs that protect land and water resources by curtailing production on sensitive lands, the Environmental Quality Incentives Program (EQIP) supports conservation on working lands. Promoting agricultural production and environmental quality as compatible goals is particularly important in the Midwest agricultural heartland.

The President is proposing to fund EQIP at $1.0 billion in FY 08, essentially unchanged from the FY 07 funding level. The UMRBA supports this investment, noting that EQIP is a tremendously popular conservation program in the 5 states of the Upper Mississippi River Basin. In FY 06, $75.7 million was paid for conservation practices completed in UMR states under 1997-2006 EQIP contracts. In addition, 5700 new EQIP contracts were approved in FY 06 in the UMR states, obligating $97 million in future financial assistance. Yet that same year, an additional 6700 applications, totaling $125 million, were left unfunded.

Conservation Security Program

The President’s FY 08 budget request of $316 million for the Conservation Security Program (CSP) reflects a 22 percent increase over FY 07 for this popular voluntary program, which provides financial and technical assistance to agricultural producers who implement conservation measures on working lands. However, the President’s proposed funding level will only be sufficient to continue to support CSP contracts signed in prior years. No new enrollments would be offered in 2008. Given the popularity and effectiveness of the CSP, the UMRBA urges Congress to consider increasing CSP funding beyond what the Administration has proposed to enable additional eligible acreages to benefit.

In the first 3 years of CSP (2004-2006), 28 of the 280 eligible watersheds in the nation were in the 5 states of the Upper Mississippi River Basin. Within those 28 watersheds, there are 6139 approved CSP contracts, which constitute nearly one-third of all CSP contracts, and total $56 million in approved payments.

In FY 07, there are 51 additional watersheds eligible for CSP nationwide, including one in each of the 5 UMRBA states.

Conservation Technical Assistance

Through the Conservation Technical Assistance (CTA) program, NRCS provides the technical capability that helps people plan and apply conservation on the land. NRCS works through and in partnership with conservation districts to assist individuals and groups in assessing conservation needs and planning, designing, and installing conservation practices. In addition, the CTA program assists in preparing landowners to participate in USDA conservation financial assistance and easement programs, provides emergency disaster technical assistance, and enables NRCS to coordinate with other programs such as U.S. EPA’s nonpoint source management program and U.S. Fish and Wildlife Service’s Partners for Wildlife. Approximately $91 million in CTA funding was allocated to the five UMRBA states (Illinois, Iowa, Minnesota, Missouri, and Wisconsin) in FY 06.

Given that CTA is the foundation for much of the nation’s private lands conservation assistance, UMRBA supports the President’s FY 08 funding request of $679 million for CTA, a 3 percent increase over the FY 07 estimated spending level.

Watershed Programs

The UMRBA is concerned that the President is proposing deep cuts to NRCS’s watershed programs, including total elimination of the Watershed and Flood Prevention Operations program, which funds P.L. 566 and P.L. 534 projects. Funding for Watershed Operations has declined substantially over the past 20 years, from an historical high of $199 million in FY 94 to only $74 million in FY 06. And yet this program provides significant local, regional, and national benefits, by addressing watershed protection, flood prevention, erosion and sediment control, water supply, water quality, water conservation, agricultural drought problems, rural development, municipal and industrial water needs, upstream flood damages, fish and wildlife habitat enhancement, and wetland creation and restoration. In September 2005 there were $1.85 billion of unfunded federal commitments to P.L. 566 and P.L. 534 projects nationwide, with $208 million of that in the states of Illinois, Iowa, Minnesota, and Missouri. Despite the fact that P.L. 566 and P.L. 534 projects in these 4 states were allocated 31 percent of the total national funding in FY 06, that amount ($21.7 million) was far less than the $208 million backlog. In FY 06, although there was only $69 million allocated for watershed protection and flood prevention operations nationwide, there were funding requests totaling over $174 million, $44 million of which were in the five UMRBA states. Rather than eliminating this important program, UMRBA urges that it be funded at least equal to the FY 06 level.

The rehabilitation of aging flood control dams must also be addressed. Of the 11,000 P.L. 534 and P.L. 566 dams nationwide, more than 3,000 will reach the end of their design life by 2013. Recognizing this fact, Congress authorized the Watershed Rehabilitation Program in 2000 and authorized significant new funding for the program in the 2002 Farm Bill. However, that authorization expires at the end of FY 07. Nevertheless, the President has proposed $6 million for the Watershed Rehabilitation program in FY 08, targeting it exclusively on technical assistance. That amount is well below the recent funding levels of $30 million and only a small fraction of the $150 million authorized for FY 07. Repair, upgrade, or removal of aging dams, which could become a threat to public health and safety, is extremely important and UMRBA thus urges Congress to reauthorize and increase funding for the Watershed Rehabilitation Program.

Upper Mississippi River Basin Association

415 Hamm Building, 408 St. Peter Street

St. Paul, Minnesota 55102

phone: 651-224-2880