Sep 08, 2008 - 04:05:13 CDT
(This is the second in a two-part series on the Conservation Reserve Program. Today's story looks at why farmers and ranchers are leaving the program.)For those who hate the Conservation Reserve Program, there will be less of it to kick around in coming years.
For those who love it for how it protects fragile soil and water quality and provides good game habitat, there will be regret.
For the first time in the program's 23-year history, North Dakota landowners are paying money to get their acres back.
High prices for crops and land rent are increasingly more attractive than the government check to idle environmentally sensitive land in a program that dates back more than two decades.
Emmons County is an excellent case in point.
Dan Weber, county Farm Service Agency director, said landowners there are opting out in a small, but steady stream.
Weber said his county approved 17 requests to terminate contracts this year and landowners paid $28,400 in liquidated damages to get more than 3,300 acres free of them.
He said he expects more terminations in the next two years if rent and crop prices remain high.
The situation is similar in nearby Logan County.
FSA director Laura Heinrich said her county approved 19 terminations involving 3,300 acres, for less than $1,800 in damages.
There won't be a wholesale bailout because not everyone can terminate. It has to do with the way CRP contracts are being written.
In 2006, the USDA told landowners whose contracts would expire before 2010 they could either extend their existing contract for two to five years, or, they could re-enroll for 10 to 15 years under a new contract if the land was deemed to have a high environmental benefit.
Only landowners who've re-enrolled can terminate because they haven't yet gotten a CRP rent check under the new contract. The damages are set at 25 percent of one year's annual payment.
Anyone with an extended contract would have to pay back all their CRP rent - which goes back a decade or more in most cases - plus the government's share of planting grass cover, plus interest, plus damages to get out.
"You can quickly see why it wouldn't make sense. Their only option is to wait," Weber said.
In Emmons County, cash rent is running at about $40 an acre or more, while the government pays landowners between $26 and $31 an acre to plant grass and idle land.
Landowners are doing the math.
Emmons and Logan counties are not islands in this regard.
Jay Hochhalter, the USDA's CRP specialist in Fargo, said requests to terminate contracts statewide have been running at about 30 to 40 a month for the past eight months.
Some terminations are for small acreages; some for more.
The trend is alarming, at least from a conservation perspective.
"We rarely saw anyone give up a contract voluntarily," said Hochhalter. Until now.
It's hard to know what landowners would do if they could get a "get out of CRP-free card," but Hochhalter said the government isn't giving those away, though USDA did give the idea some thought this summer.
"There will be no penalty-free early out," Hochhalter said.
There were signs of growing discontent with the CRP program even before landowners started to request these terminations.
North Dakota has 500,000 fewer CRP acres than it did two years ago, mostly because many landowners declined to extend, or re-enroll their contracts when they were offered the opportunity back in 2006.
The state's total has slipped to 2.9 million acres in CRP and much of that is in contracts that will expire over the next four years.
"It is going to go down," Hochhalter said. How much the total goes down is impossible to predict, but the trend should stabilize after the more attractive acres - those best suited for crops - are taken out, he said.
In the meantime, a program that is probably more revered by those "outside" it than "inside" it, as Weber says, is going to change.
The change will be tangible.
"There is an economic upside to all forms of hunting with the wildlife habitat," Hochhalter said.
Nationally, the trend is the same. There are 32 million acres in CRP around the country; 5 million less than the peak enrollment.
Tom France is an attorney in the resource division of the National Wildlife Federation, which has successfully twice gone to court to protect the benefit of CRP for soil conservation, wildlife and water quality.
France said the Bush administration is not committed to CRP and it shows in the declining number of acres in the program and the fact that USDA has not offered a new signup in years.
He said the program is a win-win for all interests, but it needs to swing more closely to the market so landowners don't lose money staying in the program.
"It's a voluntary program and if the incentives don't work, then it's understandable why landowners are leaving it," France said.
(Reach reporter Lauren Donovan at 888-303-5511 or lauren@westriv.com.)
SE ND wrote on Sep 10, 2008 2:37 PM:
dof wrote on Sep 8, 2008 2:07 PM:
Delbert Moore wrote on Sep 8, 2008 12:12 PM:
There is a partial solution though: (1) Restrict ethanol subsidies to an amount of increase corresponding to increased corn production. (2) In order to reduce the pressure for more feed from livestock producers allow CRP land to be hayed or grazed along with a continuation of a lower CRP payment. (3) Do not allow crop insurance or disaster payments for CROP production other than hay for land coming out of CRP that is marginal or sub-marginal. Under no circumstance should disaster payments be made on land diverted from virgin rangeland "
sw nd wrote on Sep 8, 2008 11:43 AM:
Kevin wrote on Sep 8, 2008 9:25 AM:
Law wrote on Sep 8, 2008 8:51 AM:
Perry Fuchs wrote on Sep 8, 2008 7:33 AM:
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