The Role of NRCS in the Future of Private Lands Conservation

Remarks by Bruce I. Knight, Chief, Natural Resources Conservation Service,
at The Nature Conservancy Annual External Affairs Conference
Arlington, VA
September 5, 2003

Thank you, Karen (Berky), and good morning, everyone. It is a pleasure to be with you this morning to talk a bit about the role of the Natural Resources Conservation Service in the future of private lands conservation.

And thank you, Karen for the topic. As you know, the chance to speak about the longer vision is a true pleasure. For those of you in the audience who want the standard farm bill update – that will have to come in the question period.

The topic is appropriate because the role of NRCS is undergoing a change, partly because of the natural evolution of conservation policies and partly because of new philosophies introduced by President Bush and Secretary Veneman. Our role is also changing as a result of how the Administration’s philosophy played out in the 2002 farm bill.

In 2001, USDA published a booklet called “Food and Agricultural Policy: Taking Stock for the New Century.” This document covered all aspects of food and agriculture, including conservation.

Secretary Veneman called for striking a new balance in our nation’s conservation programs – a balance that concentrated more on working lands conservation and less on idle land conservation strategies.

She called for us to design and adopt a portfolio approach to conservation that combines targeted technical assistance, incentives, compensation for environmental achievements, and limited use of idled lands to achieve conservation goals.

The Administration worked with Congress to produce a farm bill that embraces these principles. Working lands became an essential feature of the 2002 farm bill through tremendous increases in existing conservation programs and through creation of new programs such as the Grassland Reserve Program.

Secretary Veneman also called on us to accommodate new and emerging environmental concerns, such as developing sources of renewable energy, reducing greenhouse gas emissions, reducing nutrient runoff from livestock production, and addressing conflicts over scarce water supplies. President Bush shares this concern for emerging environmental issues, as is shown in his renewable energy program, his Clear Skies Initiative, his Healthy Forests Initiative, and his commitment to reduce greenhouse gas emissions.

Secretary Veneman also called on us to reaffirm market-oriented policies and pursue market-based approaches to encourage greater private sector investment in environmental goods and services, rather than relying so much on Federal and State dollars. NRCS and the Department of Agriculture are involved in an effort to determine how we can use market forces to create viable voluntary trading programs for both carbon sequestration and water quality.

We feel that encouraging the development of markets for environmental credits of many types is the best way to accelerate public and private efforts to address many of the new and emerging conservation issues. I will talk a bit this morning about our efforts to encourage the development of environmental credit trading.

Finally, the Secretary called on us to increase our collaboration with non-Federal governmental agencies and private for-profit and not-for-profit organizations that are playing an ever-increasing role in the delivery of technical assistance and helping finance conservation efforts.

The great news about the farm bill is that it increases our Nation’s investment in conservation by more than $17 billion over a ten-year period. However, we have discovered that America’s farmers, ranchers, and woodlot owners want to do even more conservation than that.

For example, between last year and this year, NRCS has invested more than 2.5 billion dollars in private lands conservation. At the same time, we have received so many new applications for cost-share and incentive contracts that many of our programs are approving only one out of every ten applications.

The only way for our nation to make it possible for all these landowners to reach their conservation goals is to increase collaboration. We need to leverage the Federal investment with other public and private resources. The more organizations that work together and contribute to private lands conservation, the more conservation we can do. The Nature Conservancy has been a valuable partner and contributor to conservation for many years, and, in my opinion, your role can only increase.

So, we have a greater emphasis on conservation on working lands, a greater emphasis on new and emerging conservation issues, increasing emphasis on market-based solutions, and a growing need for collaboration to get all this conservation work done. All this adds up to an even greater role for NRCS as a conservation catalyst.

Gone are the days when we and our traditional conservation partners, such as conservation districts and State conservation agencies, could be the major suppliers of technical assistance, when we could have the dominant role in on-the-ground guidance for the installation of conservation practices. The NRCS of the future will increasingly work through – and with – others to get the job done.

Being a catalyst is a different approach than being a direct supplier, and it will require a different organizational structure, one designed to keep our scientific, customer service, quality control, and accountability functions up to date and ready to interact with more technical service providers and more partners. I will also talk a bit this morning about our proposed reorganization at NRCS.

But before I get down to that business, I want to mention one major example of how we are already working through others: the Technical Service Provider concept mandated by the 2002 farm bill.

What we have done is create a new industry of non-Federal technical service providers, who are making their services available to NRCS and to producers to provide technical assistance and to plan, design, and install conservation practices.

NRCS is certifying these providers, based largely on their participation in the certification programs of the leading professional associations, universities, and even private firms. We now have more than a thousand certified technical service providers registered. In addition, we have a variety of agreements in place with partner organizations in governmental agencies and elsewhere to provide technical services.

This year, we have set aside $20 million in farm bill funds to cover the cost of technical services from sources outside NRCS. The farm bill investment in conservation will continue to grow in the future, so we will see a parallel growth in the technical service provider industry.

The Technical Service Provider concept brings many more participants into the conservation process, and is a good example of how NRCS is increasing its role as a catalyst for conservation, rather than just providing services directly.


ENVIRONMENTAL CREDIT TRADING

I promised to talk a bit about what USDA is doing to help develop the concept of voluntary markets for trading environmental credits. I am convinced that environmental credit trading is going to be an important part of the future of conservation on America’s working lands. Trading is another example of how the Federal government will become more of a catalyst for conservation.

The public is demanding more and more in the way of environmental goods and services from farmers, ranchers, and woodlot managers -- cleaner air, cleaner and more abundant water, reduced greenhouse gas emissions, more and better habitat, and better protection of open spaces. Under the present way of providing these goods and services, the cost is borne largely by the owners and mangers of the land, while many of the benefits accrue to society at large.

That equation is clearly unfair to landowners, and it is not good for our agricultural economy. That is why I think we will see more movement toward market-based solutions, such as trading in environmental credits.

The movement is underway. One indication is that this spring USDA formed an interagency working group to come up with a Department policy on environmental trading. The group includes representatives from 10 USDA agencies. And in turn, the Natural Resources and Environment mission area is providing the policy leadership for this effort.

NRCS is providing the leadership for the working group. We are working on a Departmental Directive that will describe roles and responsibilities, key principles, and how USDA programs and policies can promote voluntary trading. The policy will be applied consistently across USDA agencies and programs in a way that can improve environmental quality and produce economic benefits for the American people.

The working group members will be looking at existing trading projects and working with buyers, sellers, and aggregators in both carbon-based trading projects and water quality trading projects. We hope to have the Departmental Policy drafted by the end of the calendar year.

This effort has similarities to what USDA did in the late 1980s to come up with a water quality policy.

Another project we are hoping to launch is to work with the U.S. Environmental Protection Agency and other partners to implement a pilot program for water quality trading within a major river basin.

We are looking into the feasibility for establishing partnerships at the local, state and Federal level to implement a pilot trading program on a basin-wide basis. To do this, we will have to do an analysis to determine where there is feasibility for trading, especially between point and non-point sources of water pollution.

Then we need to work to obtain political support for a trading framework, develop a consensus on the design of the program, and finally leverage Federal, State, local, and private resources to develop and implement the program.

We hope such a program will assist Federal, state and local governments in meeting their respective goals for water quality, including avoiding the need for Total Maximum Daily Loads in some cases and lowering the costs of implementing TMDLs where they are necessary. We also hope such a program will produce ancillary benefits, such as wildlife habitat, fisheries, and carbon sequestration.

A Midwest river basin is probably best for such an experiment because work there has the potential to improve local water quality, reduce nitrogen loads to the Gulf of Mexico, and mitigate the emission of greenhouse gases from agricultural operations. There are major municipal waste water treatment plants and other point sources and many agricultural operations throughout the major river basins of the Midwest.

We could use such a pilot to help us Transfer the lessons learned to other watersheds and river basins, develop new technologies to control or reduce nutrient and sediment levels, quantify reductions from point and non-point sources, obtain information to compare the costs and benefits of improving water and air quality, while maintaining agricultural productivity, and to identify and overcome barriers to market-driven water quality improvements.

The farm bill gives us several tools to use in the agricultural part of such a pilot, including increased investment in the Environmental Quality Incentives Program, increases in the allowable acreage under both the Conservation Reserve Program and the Wetlands Reserve Program., and increased funding through the new Conservation Security Program and the Grassland Reserve Program. We also have Conservation Innovation Grants that could be used on a competitive basis to stimulate innovative approaches to leveraging the Federal investment in such a pilot.

The role of NRCS in environmental credit trading will be to help create policy and programmatic tools that encourage trading, to help find methods for measuring and placing a value on the environmental goods and services produced by landowners, and to provide technical and financial assistance to encourage production of environmental goods and services.

All these roles are more like being a catalyst than being directly responsible for getting conservation done. The result should be more conservation for the public and a strong agriculture industry for both the public and our farmers and ranchers.


REORGANIZATION

NRCS has always been known for providing high-quality science and high-quality service, but we will need to be even more efficient and effective in both these areas to support all the conservation that is happening on America’s private lands as a result of the 2002 farm bill.

Landowners and our partners will need up-to-date standards for conservation practices, and they will need up-to-date advice from NRCS employees in every state. We have decided that we need to refocus our operational, technology support, and resource assessment functions in order to meet these growing needs in the future. So, we are proposing to reorganize our activities above the State office level to strengthen our ability to help America's farmers and ranchers reach their conservation goals and to offer them the latest science-based technologies.

The proposed reorganization will involve our Institutes, Regional Offices, Divisions in the National Headquarters, and Cooperating Scientist positions. The reorganization will not directly affect State, area, and field offices, except to improve their ability to provide service.

The proposed reorganization will:
• Strengthen and enhance the multi-disciplinary technology support to States;
• Consolidate similar functions to enhance communications and coordination;
• Align human capital resources with mission, goals and organizational objectives;
• Provide an improved career ladder for technical personnel; and
• Balance Deputy areas and workload at the national level.

The reorganization effort will be key to empowering the next level of excellence in conservation service for NRCS.

We discussed this reorganization with the NRCS Leadership team late in July. We anticipate announcement of a decision by USDA around mid-October to early November, with the reorganization to take place this winter.


CONCLUSION

Let me summarize by saying that our expanded role as a conservation catalyst will involve working with more partners in more ways than ever before. I am confident that The Nature Conservancy will continue to be a valuable partner and that you will become involved even more in private lands conservation than you have been in the past.

The increased emphasis on working lands represented by the Conservation Security Program will encourage stewardship in ways beyond those represented by our traditional easement programs. Market-based programs such as trading in environmental credits will also bring more parties into the conservation effort. And our new NRCS organization will be there to provide the technical and financial assistance all these new partners will need and expect.

Together, we will all participate in what I call the Next Golden Age of Conservation.

Thank you.