oversight

Farm Programs: Conservation Compliance Provisions Could Be Made More Effective

Published by the Government Accountability Office on 1990-09-24.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                 United   States   General   Accounting   Office
                 Report’to the Chairman, Committee on              ’
GAO              Agriculture, House of Representatives



September l!H@
       .         FARM PROGRAMS
                 Conservation
                 Compliance Provisions
                 Could Be Made More
           i     Effective
      Resources, Community,   and
      Economic Development    Division

      B-240470

      September 24,199O

      The Honorable E (Kika) de la Garza
      Chairman, Committee on Agriculture
      House of Representatives

      Dear Mr. Chairman:

      In response to your request and subsequent discussions with your office, this report
      discusses the Department of Agriculture’s administration of the conservation compliance,
      sodbuster, and swampbuster provisions of Title XII of the Food Security Act of 1985.

      As requested by your office, we obtained oral comments from the Department of Agriculture.
      Department officials generally agreed with a draft of the report. We plan to distribute this
      report today to the Secretary of Agriculture and other interested parties.

      This report was prepared under the direction of John W. Harman, Director, Food and
      Agriculture Issues (202) 275-5138. Other major contributors to this report are listed in
      appendix II.

      Sincerely yours,




$-.     D*@
      Assistant Comptroller General
                           substantial erosion. Expanding the criterion would provide additional
                           soil savings, but would also involve additional costs. Second, the act
                           does not fully protect highly erodible land or wetlands from conversion
                           because violations are not recognized until crops are actually planted on
                           converted land.

                           Although USDA has successfully helped farmers develop conservation
                           plans, it faces implementation obstacles. Because of budget constraints,
                           USDA expects that it will not have sufficient technical and financial
                           resources to help farmers implement their plans, which will adversely
                           affect farmers’ ability to achieve the soil savings anticipated by the
                           plans. As of July 1990, USDA'S Soil Conservation Service (scs) had not
                           calculated the national savings expected when producers implement
                           their plans.

                           Since USDA concentrated on developing conservation plans to meet the
                           deadline set by law, it has only identified about 7.5 million acres of wet-
                           lands of the estimated 82 million acres of wetlands on nonfederal land.’
                           USM plans to make wetland determinations on those lands on or near
                           cropland of farm program participants, but has not made any estimate
                           of the number of wetland acres it expects to identify for compliance
                           with the act. Further, in permitting some wetlands to be drained, IJSDA
                           has not consistently applied criteria established to make these decisions
                           nor has it always consulted the Fish and Wildlife Service as required.



Principal Findings

Opportunities to Protect   USDA  conservation criteria, implementing the act for highly erodible
More Land                  land, do not protect all erodible lands and wetlands. USDA requires con-
                           servation plans for cropland that has a potential to erode eight or more
                           times the erosion rate at which the land would remain productive-142
                           million acres using this erosion criterion. The Department’s data show
                           that millions of other cropland acres have an erosion potential just
                           below this level. For example, about 75 million acres of land are eroding
                           at 5 to 8 times the soil tolerance level. Any increased soil savings associ-
                           ated with changing IWA'S criterion should be balanced against the addi-
                           tional implementation costs.

                           'Identification of wetlands refersto the processwhereby USDAdeterminesif a land areaexhibits the
                           soil, water, and plant charactensticsthat define a wetland



                           page3                                             GAO/RCED-90206ConservationCompliance
                  the Fish and Wildlife Service in a number of instances when allowing
                  certain wetlands to be drained, as required by the act.


                  If the Congress wishes to protect more erodible land, it may wish to con-
Matters for       sider requiring USDA to lower its criterion to a level that would protect
Congressional     more lands that erode at substantial rates but at less than the current
Consideration     USDAcriterion. While such a change would reduce erosion, it would also
                  increase USDA's costs for administering the act’s provisions on more land.
                  Among other things, the Congress may also wish to consider amending
                  the act so that benefits are lost when highly erodible land or wetlands
                  are converted for planting, and require the restoration of such con-
                  verted wetlands or the mitigation of such damages before eligibility can
                  be regained. (See chs. 2 and 3.)


                      makes several recommendations to the Secretary of Agriculture to
Recommendations   GAO
                  improve the administration and effectiveness of the conservation provi-
                  sions of the act.


Agency Comments   agency officials to obtain their oral comments. USDA offered a number of
                  observations about GAO'S findings and recommendations, including the
                  following: (1) its selected erosion level covered lands with the greatest
                  need for soil erosion treatment, (2) wetland determinations were neces-
                  sary only on lands on or adjacent to cropland and, as such, not all of the
                  wetlands would need to be identified, and (3) GAO'S draft did not fully
                  recognize USDA’S ongoing efforts to review and correct previous com-
                  menced conversion decisions.

                  Regarding the first observation, GAO did not recommend that USDA
                  change its criterion, but suggested that if the Congress wishes to protect
                  more erodible land, considering the increased costs, lowering the crite-
                  rion could be used to do so. (See ch. 2.) While USDA’S second observation
                  is reasonable, until it identifies wetlands, it will be difficult for it to
                  enforce the swampbuster provisions of the act. (See ch. 4.) Finally, GAO
                  modified the report to reflect USDA’S efforts on commenced conversions.
                  (See ch. 4.)




                  page 6
                    contents




Chapter 5                                                                                      36
Enforcement Needs   Weaknesses in ASCS’ Compliance Monitoring
                    Conclusions
                                                                                               36
                                                                                               38
Improvement         Recommendations to the Secretary of Agriculture                            38
                    Agency Comments and Our Evaluation                                         39

Appendixes          Appendix I: Sampling Methodology                                           40
                    Appendix II: Major Contributors to This Report                             41

Tables              Table 3.1: Examples of Planned Soil Savings Under Each                     22
                        Conservation Alternative
                    Table 3.2: SCS’ Estimate of Major Conservation Practices                   23
                        Planned
                    Table 3.3: Estimated Cost-Share Funding Needed for                         24
                        Conservation Plans in Iowa, Kansas, and Missouri
                    Table 4.1: Changes in USDA Exemption Criteria for                          30
                        Commenced Conversions
                    Table 5.1: Violations Reported and Resolved                                38
                    Table 1.1: Sample of Farms With Conservation Plans                         40

Figures             Figure 2.1: Amount of Cropland and Wetlands in the                          14
                         IJnited States
                    Figure 2.2: Erosion Potential of the Nation’s 423 Million                   16
                         Cropland Acres
                    Figure 3.1: Estimated Frequency of Conservation                            20
                         Applications Planned in Counties We Visited




                    Abbreviations

                    ASCS        Agricultural Stabilization and Conservation Service
                    FCIC        Federal Crop Insurance Corporation
                    hIHA        Farmers Home Administration
                    GAO         General Accounting Office
                    scs         Soil Conservation Service
                     USFWS      US. Fish and Wildlife Service
                     I:SDA      U.S. Department of Agriculture


                    page 7                                  GAO/RCEMtO-206 Conservation Compliance
                           Chapter 1
                           Introduction




                           Erosion is a natural process whereby water and wind move soil. Erosion
Why Soil Erosion and       decreases soil productivity by removing nutrients and organic matter
Loss of Wetlands Are a     and by thinning and modifying the soil zone where plants grow. Erosion
Problem                    on land covered by vegetation is probably no more than 1 inch every
                           100 years, and much of this loss is offset by the formation of new soil.
                           However, wind and water erosion on bare cropland can gradually reduce
                           productivity. Erosion also contributes to sedimentation of streams and
                           other water bodies and damage to surface and groundwater quality.

                           A variety of benefits are lost when wetlands are drained. Wetlands are
                           essential habitat for a variety of fish and wildlife species. Some wet-
                           lands play an important role in the life cycle of many fish species.
                           Waterfowl depend on wetlands for breeding areas, and fur-bearing and
                           other game species depend on wetlands for food, cover, or water. Wet-
                           lands store flood waters, may retard flood peaks, and can improve water
                           quality by trapping sediment and removing nutrients, pesticides, and
                           other toxic substances. Wetlands are also popular recreation sites.


                           The act’s conservation provisions restrict the use of highly erodible land
How the Conservation       and wetlands through the sodbuster and swampbuster provisions,
Provisions Work            respectively. To remain eligible for USDA benefits, producers must apply
                           an approved conservation system to highly erodible land that they farm,
                           and they must not convert and plant an agricultural commodity on cer-
                           tain wetlands. Violations are subject to loss of USDA benefits,


Conservation Compliance    The conservation compliance and sodbuster provisions of the act pro-
and Sodbuster Provisions   hibit the cropping of highly erodible land without applying an approved
                           conservation system. The distinction between the two provisions is that
                           the conservation compliance provisions apply to cropland that was
                           being farmed at the time the act was passed4 and the sodbuster provi-
                           sions apply to land that was converted to cropland after the act was
                           passed.5

                           Farmers of highly erodible land must develop and implement a plan that
                           uses approved conservation systems to reduce erosion to an acceptable

                           4Theconservationcomplianceprovision appliesto highly erodiblecroplandthat was usedfor
                           planting an agricultural commodity(a crop planted and producedby annual tilling of the soil, or
                           sugarcane)or set asideat least 1 year between1981and 1985.
                           “The sodbuster provision appliesto highly erodibleland that was not usedfor planting an agricul-
                           trral commodityor set asidebetween1981and 1986.



                           Page 9                                               GAO/‘RCEDSO-206
                                                                                              Conservation Compliance
                            Chapter 1
                            Introduction




                            with the Department of the Interior’s U.S. Fish and Wildlife Service
                            (usnvs) on certain questions involving wetlands.


                            The Chairman of the House Committee on Agriculture asked us to
Objectives, Scope,and       review USDA’S implementation of the Food Security Act’s conservation
Methodology                 provisions. The Committee was interested in learning how the programs
                            have been working to determine if changes to the act were needed. As
                            agreed with the Chairman’s office, our objectives were to address the
                            following questions:

                        . What is the status of USM’S implementation of the conservation pro-
                          grams, and how many acres have been affected? (See chs. 2,3, and 4.)
                        . As a result of these activities, what soil and wetland savings have
                          resulted? (See chs. 3 and 4.)
                        - How has USDA enforced the conservation provisions, and how many pro-
                          ducers have lost benefits? (See ch. 5.)
                        l What changes in the conservation provisions of the Food Security Act or
                          in their implementation should be made? (See chs. 2,3,4, and 5.)

                            The scope of our work and methodology used to meet the objectives con-
                            sisted of reviewing pertinent implementation and enforcement informa-
                            tion and interviewing knowledgeable officials at the national, state, and
                            county levels. This included ASCSand m headquarters; state offices in
                            Iowa, Kansas, Minnesota, Missouri, and North Dakota; and six county
                            offices in these states. We also obtained information and reports from
                            FhHA, PCIC, the Economic Research Service, USFWS,and environmental
                            and farm organizations.

                            We considered the amounts of highly erodible land and wetlands identi-
                            fied by SCS, the number of sodbuster and swampbuster violations
                            reported by ASCS,and the time and resources available for our review in
                            selecting Iowa, Kansas, Minnesota, and Missouri, and the four counties
                            visited in those states. The number of commenced conversion requests
                            and the resulting decisions were considered in selecting North Dakota
                            and the two counties visited in that state. (The five states we visited
                            contained a total of 38.9 million acres of highly erodible land, or 27.5
                            percent of the total highly erodible land in the llnited States as identi-
                            fied by USDA.)

                            To determine USDA'S status of implementing the conservation programs,
                            the acres affected, and the soil and wetland savings, we reviewed USDA’S
                            procedures, status reports, and national resources inventories, and we


                            Page 11                                GAO/UCEDW206    Conservation Compliance
The Act Does Not Protect All Highly Erodible
Land and Wetlands

                        The act’s conservation compliance, sodbuster, and swampbuster provi-
                        sions do not protect all of the nation’s erodible land and wetlands. The
                        act protects only those lands that are farmed by USDA program partici-
                        pants. The amount of land actually protected is further limited by USDA’S
                        criteria for requiring conservation systems on erodible cropland. USDA
                        requires that land have a high erosion potential to qualify for conserva-
                        tion compliance or sodbuster protection. This erosion potential is the
                        only criterion used by the Department to determine land that will be
                        protected. This contrasts with the conservation reserve program, where
                        USDA considers other factors besides erosion potential, such as whether
                        trees are planted or if there is serious gully erosion, to qualify land for
                        enrollment and rental payments. The act withdraws farm benefits on
                        highly erodible land and wetlands converted for planting purposes.


                        The 1.94 billion acres of the United States includes about 423 million
Land Protected by the   acres of cropland and 82 million acres of wetlands that are not federally
Act                     owned.’ Figure 2.1 shows the amount of the nation’s cropland and wet-
                        lands relative to other land uses.




                        ‘Both federally owned and nonfederally owned(private) lands are coveredby the act. However,most
                        of the nation’s faming activities occuron private lands.



                        Page 13                                          GAO/RCEDgo-206 Conservation Compliance
chapter 2
The Act Does Not Protect AU Highly Emdible
Land and Wetlands




As implemented by scs, the conservation compliance provisions focused
primarily on reducing soil erosion on some of the nation’s most erodible
cropland. On the other hand, the conservation reserve program, while
similarly designed to reduce soil erosion on cropland, was also envi-
sioned as a program to improve water quality and fish and wildlife
habitat, and as a means to curb the production of surplus commodities,
among other things. As such, the conservation reserve program uses a
number of criteria for determining soil erodibility. For example, under
this program, land can be enrolled if it has an actual erosion as low as
twice the soil loss tolerance level-2T-if     trees are planted or if there is
serious gully erosion. ’ Further, in this example, if a field were to have
trees planted, only one-third of the field would have to be eroding at 2T
instead of two-thirds of the field as is normally the requirement under
the program.

IJSDA identified  142 million acres of highly erodible cropland using its
erosion potential criterion of 8 times the soil tolerance level. As shown
in figure 2.2, this USDA criterion does not cover about two-thirds of the
nation’s cropland. On the basis of USDA data, millions of other acres of
land are eroding at substantial rates within the 281 million acres of
cropland not covered by USDA’S criterion. For example, about 75 million
acres of land are eroding at five to eight times the soil tolerance level.
Reducing the erosion criterion to a level below eight times the soil toler-
ance level would result in increased soil savings through reduced ero-
sion, but would also increase program costs. As such, USDA would have
to use its limited resources to develop additional conservation plans on
these cropland acres as well as provide technical and financial assis-
tance in some cases in order to implement the plans. Therefore,
including additional lands in IJSDA’S coverage of highly erodible acres
would have to be considered in light of the cost of this additional cov-
erage and competing Department objectives. Nonetheless, as existing
conservation plans are implemented to meet the 1995 requirement set
by the act, conservation planning for other highly erodible lands could
be phased-in as departmental resources allow, thereby increasing the
environmental benefits associated with reduced soil erosion.




“The soil losstolerancelevel, or T asit is cmnmonlyreferred to, is the rate at which soil can erode
and maintain continuedproductivity. 2T refers to twice this erosionlevel. The T level varies
dependingon the geographicarea,solI t,ype,and water and wind conditions,amongother things.



Page 15                                               GAO/RCED90206       Conservation Compliance
                      Chapter 2
                      The Act Does Not Protect All Hiy   Emdible
                      Land and Wetlands




                      Producers who do not participate in USDA'S farm programs are exempt
Conclusions           from the act’s conservation provisions. For farmers participating in
                      farm programs, USDA is applying the conservation compliance and
                      sodbusterprovisions to the most erodible land. There are opportunities
                      for USDA to cover more erodible cropland by expanding its criterion to
                      include, among other factors, lower erosion potential and actual erosion.
                      However, the additional soil savings would have to be considered in
                      light of the added cost to protect these lands and other departmental
                      objectives. In addition, the sodbuster and swampbuster provisions of the
                      act do not come into effect when highly erodible land and wetlands are
                      converted. The act could protect more erodible lands and wetlands if
                      farm program benefits are withheld when these lands are converted for
                      planting and benefits are reestablished if wetlands are repaired or
                      restored.


                      If the Congress wishes to increase the amount of erodible land and wet-
Matters for           lands protected and the amount of soil erosion and wetlands saved by
Congressional         the act’s conservation provisions, it could consider revising the provi-
Consideration         sions to

                  . require the Secretary of Agriculture to use a lower erosion potential or
                    other factors to define land covered by the conservation compliance and
                    sodbuster provisions and
                  . withhold benefits when highly erodible lands or wetlands are converted
                    for planting, and require the restoration of such converted wetlands or
                    mitigation of damages to converted wetlands before farm program eligi-
                    bility can be regained.


                      USDA took issue with our matter for congressional consideration that dis-
Agency Comments and   cussed the possibility of lowering the erosion level used to define highly
Our Evaluation        erodible lands. The Department told us that an erosion level of 8T was
                      selected because it included those lands estimated to have the greatest
                      need for soil erosion treatment. IJSDA also said that resource constraints
                      would have significantly affected its ability to cover more land had the
                      erosion level been set at a lower level. Further, the Department believes
                      that few additional farms would be involved if USDA subjected more land
                      to the act and thus, only a small additional soil loss reduction would
                      occur.




                       Page 17                                     GAO/RCED4CL206 Conservation CanpRance
Chapter 3

Planned Conservation Systems Will Reduce
Erosion, but All May Not Be Implemented by
the Deadline
                             As of January 1990, scs had identified virtually all of the nation’s highly
                             erodible cropland and most producers had prepared plans to reduce ero-
                             sion on this land. To ease the financial burden on producers in planning
                             conservation measures, scs relaxed its initial requirement that all pro-
                             ducers generally reduce erosion to the T level. Thus far, scs has not cal-
                             culated the total soil savings expected for the nation when producers
                             fully implement their conservation plans. Our review of a limited sample
                             of conservation plans in six counties in five states indicates that, when
                             implemented, soil erosion will be reduced on most of the fields in these
                             counties. However, despite the relaxed soil loss erosion requirement,
                             many of the systems planned may not be implemented by the deadline
                             of January 1, 1995. According to SCS, this is because it will not have the
                             staff or cost-share funding needed to assist producers in implementing
                             the plans.


                             scs estimates that it has identified virtually all of the nation’s highly
Producers Have               erodible cropland and that participants have planned conservation sys-
Prepared                     tems to reduce soil erosion on most of this land. In January 1990, scs
Conservation Plans for       reported that, including land in the conservation reserve program

Most Highly Erodible     l   it had identified 142 million acres, or an estimated 99 percent, of the
Cropland                     nation’s highly erodible cropland;
                         l   producers had prepared conservation plans for about 135 million acres,
                             or about 95 percent, of the highly erodible cropland; and
                         l   producers had applied conservation systems to 36 million acres of this
                             highly erodible land.

                             Although IJSDA initially required that all producers generally reduce ero-
                             sion to the T level, it later relaxed the requirement to ease the financial
                             burden on producers for installing conservation systems. USDA’S interim
                             rules that applied through June 1987 required producers to adopt con-
                             servation plans that would generally reduce soil erosion to the T level.
                             Subsequent interim rules and the September 1987 final regulation
                             allowed producers to meet a lesser or alternative erosion reduction
                             requirement in those areas where reducing erosion to the T level could
                             impose an economic hardship.’ Later, in May 1988, IJSDA announced that



                             ‘The alternative levrl that fanners must meetvaries by geugrapiucalarea.



                             Page 19                                            GAO/RCEJMO-206 Conservation Compliance
                         Chapter3
                         Planned c!on!3ervation syst.2ms will Reduce
                         Erosion, but All May Not Be Implemented by
                         the Deadline




                         no national estimate of the amount of soil that will be saved when the
Plans Are                conservation systems planned for 135 million acres of highly erodible
                         land are implemented. Our sample of conservation plans for farms in six
Implemented              counties in five states shows that, in most instances, soil savings will be
                         realized when the conservation systems planned are fully implemented.
                         The two exceptions are sodbusted land on which a net soil loss occurs,
                         and land where no changes in farming practices were required to meet
                         the T level or alternative T level.


Estimated Soil Savings   While scs has soil savings data on individual farms at its county offices,
                         an scs representative said that there are significant differences between
                         sczscounty offices’ capability to aggregate this information and arrive at
                         a national savings estimate. Some scs county offices have the informa-
                         tion readily available on computers, while others have only hand-
                         written estimates. Although KS is upgrading and modernizing its com-
                         puter system in order to report progress, it does not know when national
                         estimates of the soil savings resulting from implementing conservation
                         plans will be available. Without a national estimate of soil savings, scs
                         will not be able to determine how well conservation systems are working
                         to reduce overall erosion on cropland in the United States.

                         Most of the conservation plans we reviewed will reduce soil erosion
                         when implemented. In our sample of conservation plans for 58 farms in
                         6 counties, we estimate that, when implemented, between about 59 and
                         100 percent of the plans will result in some soil savings. The soil savings
                         ranged from 1 ton per acre per year to 109 tons per acre per year. Table
                         3.1 shows examples of savings for fields (with identical soil losses prior
                         to conservation planning) under each of the three conservation alterna-
                         tives. As shown, erosion is reduced in all three conservation altema-
                         tives. However, land taken out of productive use in the conservation
                         reserve program reduced erosion most.




                          Page 21
                                    Chapter 3
                                    Planned Conservation Systems Will Reduce
                                    Erosion, but All May Not Be Implemented by
                                    the Deadline




                                    scs has traditionally assisted producers in designing, laying out, and
                                    supervising the application and construction of conservation systems.
                                    scs estimated the major conservation practices included in producers’
                                    conservation plans that it will help implement. Table 3.2 shows SCS’
                                    national estimate of the major conservation practices planned. These
                                    practices include agronomic and engineering applications. An agronomic
                                    practice involves changing farming practices. An engineering practice
                                    involves construction or changes to the layout of the land.

Table 3.2: SCS’ Estimate of Major
Conservation Practices Planned’     Figures in thousands
                                                                                                   Unit of
                                    Applied practice                                               measure              Amount
                                    Agronomic practices
                                    Cropping system                                                A&es                  85,200
                                    Crop residue                                                   Acres                 55,000
                                    Conservation tillage                                           Acres                 45,500
                                    Contouring                                                     Acres                 25,800
                                    Contour strips                                                 Acres                  3,300
                                    Field strips                                                   Acres                  2,000
                                    Critlcal area                                                  Acres                    552
                                    Engineering practices
                                    Grassed waterways                                              Acres                   1,300
                                    Terraces                                                       Miles                     216
                                    Sediment basins                                                Quantity                   91
                                    Structures                                                     Quantity                   46
                                    DiversIons                                                     Miles                       5
                                    aMore than one practice may be applied to the same field

                                    On the basis of its estimated workload, scs representatives estimate that
                                    scs will not have sufficient staff to provide producers the technical
                                    assistance necessary to design and install the planned conservation sys-
                                    tems. scs representatives said that field office staffing will be 37 percent
                                    less than the estimated average 9,500 staff-years needed during each of
                                    fiscal years 1990 through 1994.

                                    ASCS,scs, and states have also traditionally assisted producers in paying
                                    for up to 75 percent of the cost of conservation practices and their
                                    installation. USDA has three programs-the Agricultural Conservation
                                    Program, the Great Plains Conservation Program, and the Watershed
                                    Protection and Flood Prevention Program-that       provide cost-sharing




                                     Page 23                                              GAO/RCED9@206 Conservation Compliance
                                                 -
                        chapter 3
                        PlanlId commvation system will Redwe
                        Erosion, but All May Not Be Implemented by
                        tbe Deadline




                        even if the additional cost-share funds and needed staffing were pro-
                        vided, the state lacks sufficient contractors to install the conservation
                        systems planned.


                        scs has largely met the January 1,1990, requirements of the Food
Conclusions             Security Act of 1985 to (1) identify highly erodible cropland and (2)
                        assist producers in developing conservation plans for reducing erosion
                        on the land identified. However, according to scs, meeting the January 1,
                        1995, requirement of implementing the conservation plans will be diffi-
                        cult because scs estimates that it will not have enough staff and cost-
                        share funds. As such, these limitations may make the deadline imprac-
                        tical for some farmers. As of July 1990, KS had not determined what
                        plans can be implemented by January 1, 1995, with the resources it will
                        have available and had not developed a plan to use these resources most
                        effectively.

                        Although one objective of the conservation provisions is to reduce soil
                        erosion, scs has not estimated soil savings resulting from the implemen-
                        tation of conservation plans. Without a national estimate of soil savings,
                        scs will not be able to determine how well conservation systems are
                        working to reduce overall erosion on cropland in the United States.

                        In instances where sodbusting has occurred, soil erosion increased when
                        the land was converted to cropland use. The increase is greater on land
                        where scs allowed producers to apply alternative conservation systems.
                        These alternative systems do not reduce erosion to the level prior to
                        sodbusting or the T level set by USDA.


                        We recommend that the Secretary of Agriculture direct the Adminis-
Recommendationsto       trator, scs, to
the Secretary of
Agriculture         . prioritize its limited cost-share funds so that the Department’s resources
                      are allocated in a manner that achieves the greatest conservation benefit
                      and
                    l build on ongoing efforts and report accomplishments (soil erosion sav-
                      ings) achieved by implementing the conservation compliance and
                      sodbuster provisions




                         Page 26                                     GAO/ECED-90-206 Conservation Compliance
Implementation Delays and Inconsistently
Applied Criteria May Result in Fbrther
Wetland Losses
                        Implementation of the act’s swampbuster provisions lags behind those
                        of the conservation compliance and sodbuster provisions. scs gave pri-
                        ority to identifying highly erodible land and developing the conservation
                        plans, rather than identifying wetlands, because the act required such
                        plans by January 1, 199O.l Critical to saving the wetlands covered by
                        the act is KS identification of wetlands so that ASS, in checking compli-
                        ance, can ensure that wetlands are protected. However, scs has identi-
                        fied only about 7.5 million acres of wetlands of the estimated 82 million
                        acres of wetlands on nonfederal lands in the continental United States.2
                        USDA plans to make wetland determinations on only those lands on or
                        near cropland of farm program participants. scs expects to complete its
                        wetlands identification by the end of 1991. As a result, some wetlands
                        may have been converted to cropland that otherwise could have been
                        protected.

                        Implementing the act’s swampbuster exemption provision has, in some
                        instances, been a source of controversy because the criteria used to
                        make decisions for group projects have frequently changed.3 Further,
                        application of the criteria has not always been consistent; the documen-
                        tation provided does not, in many instances, support the exemption deci-
                        sions; and consultation with the Fish and Wildlife Service was not
                        always carried out as required by law.


                        KS has not identified and classified all wetlands. As of January 1990,
Implementation of       scs reported that it had made more than 860,000 wetland determina-
Swampbuster             tions and identified almost 7.5 million wetland acres in the process.’
ProviSioiI Has Beer‘I   USDA estimates, on the basis of its National Resource Inventory, 1987,
                        that there are about 82 million acres of wetlands on nonfederal land in
Delayed                 the continental United States. However, an scs official responsible for
                        overseeing USDA’S wetland determinations said that scs is not making
                        determinations for all of this land. Wetland determinations are only
                        being made for cropland and land adjacent to cropland on farms of USDA




                        ‘Identification of wetlands refers to the processwhereby USDAdeterminesif a land areaexhibits the
                        soil, water, and plant characteristicsthat define a wetland.
                        ‘No data exist on the extent of nonfederalwetlandsm Alaska.Therefore,our discussionis limited to
                        the 48 continental states.
                        “Group pr"J&S   involve   two   or more   farrows or producers.
                        40nly onestate we vislted, North Dakota,had a completeowentory of its wetlands



                        Page 27                                                  GAO/RCEDSO-206Conservation Compliance
                     Chapter 4
                     Implementation Delays and Inconsistently
                     Applied Criteria May Result in Further
                     Wetland Losses




                     number of individuals within a group project area. For reporting pur-
                     poses, the county recorded all persons involved in the projects even
                     though the individuals did not file separate requests.

                     ASCS issued new instructions to state and county offices in March 1990
                     for summarizing commenced conversion activity that occurred prior to
                     January 1990 and then reporting on this activity on a monthly basis.
                     ASCS advised us that a new national report was planned, but that its
                     issuance date was unclear.


Exemption Criteria   ASCS  has amended or modified the exemption criteria for commenced
                     conversion decisions several times since the publication of the interim
                     rules in June 1986. These changes occurred for a variety of reasons,
                     such as litigation by environmental groups and requests from special
                     interests. Table 4.1 highlights changes in USDA'S criteria between June
                     1986 and December 1989.




                     Page 29
                             Chapter 4
                             Implementation Delays and Inconsistently
                             Applied Criteria May Result in Further
                             Wetland Losses




Changing Criteria Resulted   Because of the changing criteria and sometimes contradictory nature of
                             commenced conversion decisions, county committees and other ASCSoffi-
in Draining Wetlands         cials made decisions which would allow the draining of wetlands. The
                             impacts of the changes, which have primarily affected group projects,
                             and the differences in the application of the criteria are illustrated by
                             the following example of an actual situation in one county we visited.

                             During the 5-year period, 1981 to 1985, assessed landowners voted for
                             and approved the installation’of five separate group drainage projects.
                             In mid-1986, the county water resource district sought advice and clari-
                             fication from ASCSon whether two of the projects met the commenced
                             conversion criteria since earth moving had not been started, nor had a
                             contract committing substantial funds for earth moving been entered
                             into. Responding to this request, ASCSamended the provisions on Sep-
                             tember 19, 1986, so that persons assessed for the drainage activity
                             would be exempt from swampbuster if the drainage plan was approved
                             before December 23,1985, and the ASCScounty committee determined
                             that the plan reasonably contemplated each person’s drainage activity.
                             Using this criterion, the ASCScounty committee approved the requests
                             on October 1, 1986.

                             As a result of requests from conservation groups, the criterion used to
                             make commenced conversion decisions was changed in February 1987.
                             Consequently, in March of that year the county committee was
                             instructed by USDA to rescind its earlier approval. As a result, only those
                             persons who took actions such as earth moving or contracting for earth
                             moving between October 1,1986, and the February 4,1987 amendment,
                             would be exempt. Other persons, in order to be exempt, would be
                             required to meet the new criteria, including the specific identification of
                             drainage activity in the plan. Subsequently, special interests convinced
                             ASCS to reverse its decision in May 1987, and thus ASCSdid not require
                             the specific identification of wetlands to be drained.        i

                             Continuing concern about the exemptions prompted the National Wild-
                             life Federation to request that ASCSreview the decisions again. In its
                             November 1988 response, ASCSconcluded that neither of the projects
                             met the commenced criteria in place at the time the projects were
                             exempted. However, since some drainage had started on one of the
                             projects on the basis of the earlier decisions, ASCSexempted this activity
                             but would not allow any additional wetlands to be drained. However, in
                             terms of the second project, ASCSdetermined that it was still in the plan-
                             ning phase, no funds had been spent toward converting wetlands, and
                             therefore the exemption was being reversed.


                             Page 31
                        Chapter   4
                        Implementation Delays and Incona~~ntiy
                        Applied Criteria May Result in Fiuther
                        Wetland Losses




                        as proof of commenced activity.6 In another instance, the producer indi-
                        cated that he had done all the work using his own equipment, and the
                        only verification was by visual inspection-no documentation was pro-
                        vided. In none of the cases did the producer submit evidence such as
                        construction receipts or cancelled checks indicating the commitment of
                        funds prior to December 23,1985, as required by the ASCShandbook.


                        The final program rules dated September 17, 1987, specifically instruct
ASCSDid Not Always      A%%to consult with the Fish and Wildlife Service on commenced deter-
Consult With the Fish   minations.6 Our review of records at the counties visited showed that
and Wildlife Service    often, such consultations are not held. Of the 27 cases we reviewed
                        where ASCScounty committees approved or denied requests (23
                        approved and 4 denied), we found that the Fish and Wildlife Service
                        was not consulted on 18, or 67 percent, of the decisions. All of these
                        instances occurred after the final program rules were implemented and
                        the Fish and Wildlife Service was specifically designated as the Depart-
                        ment of the Interior’s consultation point.

                        Although the requirement for consultation has existed since the act’s
                        passage, county officials informed us that they were not aware of the
                        need to consult until it was incorporated into the AX% handbook in Sep-
                        tember 1987. In one instance, the state office advised the county that
                        the Fish and Wildlife Service did not need to be consulted because its
                        opposition to the project was already known. Nonetheless, AX& hand-
                        book specifically states that the Fish and Wildlife Service should be con-
                        sulted for commenced conversion decisions.


                        Given its limited resources and the timetable imposed by law, the
Conclusions             Department deferred making wetland identifications until after it devel-
                        oped conservation plans. By delaying the identification of wetlands,
                        USDA’S decision may have allowed some wetlands to be drained. Like-
                        wise, the lack of firm and clearly understood criteria for exempting cer-
                        tain wetlands and the inconsistent application of the criteria have
                        resulted in additional wetland losses.



                         5The A%S handbook does not allow tax assessment notices to be used as documentation for wetland
                         conversion activities.

                         ‘USDA is required by the Food security Act to consult with the Department of the Interior as of
                         December 23,1985, on all wetland commenced determinations.



                         Page 33                                              GAO/RCELL2@296 Conservation Compliance
Chapter 4
Implementation Delays and Inconsistently
Applied Criteria May Result in Further
Wetland Losses




While USDA has undertaken these actions, they have not been completed
and as such we did not change our recommendations. Further, as a
result of previous ASCS commenced conversions decisions, some wetlands
have been converted to cropland that otherwise would have been
protected.




Page 36                                    GAO/RCED-90206 Conservation Compliance
                           Chapter 5
                           Enforcement Needs Improvement




                           programs may not be subject to being selected for this compliance
                           verification.

                           Although not required by law, the Fish and Wildlife Service in both Min-
                           nesota and North Dakota has reported suspected swampbuster viola-
                           tions to ASCS. The Fish and Wildlife Service reported 203 suspected
                           swampbuster violations to the Minnesota state ASCS office in June 1989,
                           but ASCS had not followed up on the suspected violations as of December
                            1989. We did not identify this condition in the other states visited. As of
                           December 1989, Minnesota and North Dakota required county offices to
                           complete a report detailing the investigation and disposition of sus-
                           pected violations reported by the Fish and Wildlife Service and other
                           outside parties, to maintain a file of the reports, and to notify the state
                           office of any violations arising from the investigations.


Sodbuster, Swampbuster     IJntil April 1989, x(‘s had reported national data that showed the
Data Are Not Current and   extent to which sodbusting and swampbusting violations were identified
                           and benefits withheld. However, ASCS representatives said that national
May Not Accurately         reporting was suspended because they believed that county and state
Reflect Violations         offices were incorrectly interpreting reporting instructions and there-
                           fore the accuracy of’ the reports was questionable. ASCS issued new
                           reporting instructions in March 1990 and plans to resume national
                           reporting.

                           WCS’ system for counting sodbuster and swampbuster violations actu-
                           ally counts potential \-iolations and their ultimate disposition. The
                           potential violation may be resolved with ASCS county office representa-
                           tives if the producer presents additional evidence. In addition, producers
                           can appeal ASCS determinations of violations first to ASCScounty commit-
                           tees, then to AXS state committees, and finally to the ASCSDeputy
                            .4dministrator for Statct and County Operations.

                           -4s shown in table 5. I, ixs(‘s’ latest national report, as of April 1989,
                           showed that most rcl KHYed violations were resolved in favor of
                           producers.




                           Page 37                                   GAO/RCEDW-206 Conservation Compliance
                      cbepter 5
                      Jhforcement Needa Improvement




                  l   develop a procedure to ensure that all USDA farm program participants,
                      including those participating in FCIC or FIIIHA programs, are included in
                      ASS’ universe for sampling participants’ compliance.


                      In response to our recommendations, USDA noted that (1) it will be on
Agency Comments and   alert for potential violations of swampbuster or sodbuster provisions
Our Evaluation        during the course of its normal business, including random spot checks
                      and (2) it requires all producers requesting USDA benefits to file forms
                      AD-1026 and AD-1026A. Thus, the Department believes that all pro-
                      ducers requesting benefits will be represented in the ASS computer
                      system and subject to spot checks. However, current ASCSprocedures are
                      such that not all program participants are involved in its sampling
                      universe.




                      Pege 39                                 GAO/RCED-904206 Conservation Compliance
Major Contributors ID This Report


                        Edward Zadjura, Assistant Director
Resources,              Daniel Haas, Assignment Manager
Community, and
Economic
Development Division,
Washington, D.C.

                        Carl Aubrey, Regional Mana@ment Representative
Kansas City Regional    William Gansler, Evaluator&Charge
Office                  Diane Gadberry, Staff Evaluator
                        Darryl Meador, Staff Evaluator
                        Susan Blobaum, Operations Research Analyst


                        Darrell J. Rasmussen, Site Senior
Chicago Regional        Milo Dukic, Evaluator
Office                  David R. Lehrer, Evaluator




(022966)                Page 41
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i
Appendix I

Sampling Methodology


                                 A total of 96 farms were sampled-20 farms were selected from Macon
                                 County, Missouri, and 15 farms were selected from each of the other 5
                                 counties. However, only those farms (58) that had conservation plans
                                 are discussed in chapter 3 or reflected in table I. 1 below.

Table 1.1: Sample of Ferms W&h
Conservation   Plans                                                 Universe with                               Sample with
                                                                  conservation plans                         conservation  plans
                                 countv & state                   Farmr            Acres                     Farms             ACWLS
                                 Poweshiek, Iowaa                   1,298            226,704                     13             2,012
                                 Dickinson. Kansas                  1.316            126.173                     13             1 495
                                 Stearns, Minnesota                  531              15,629                      7               322
                                 Macon, Missouri                     766              90,513                     15             2,980
                                 Grand Forks, North
                                 Dakota                              294              20.784             -        3                 49
                                 Wells, North Dakota                 368              60,386                      7               683
                                 Total                             4.575            549.199                      50             7.514
                                 ‘Poweshiek County, Iowa, reports on a tract basis The number of farms in the unwerse was dewed by
                                 dwding 2,077 tracts wth conservation plans I” Poweshlek County by the average tracts per farm I” that
                                 county, 1.6. Our sample Included 16 tracts on 13 farms




                                 page 40                                              GAO/ICED-90-206 Conservation Compliance
                                             chapter 6
                                             Enforcement Needs Improvement




Table 5.1: Violations   Reported   and
Resolved                                     Violations                                      Sodbuster       Swampbuster
                                             Reported                                               584                427
                                             Appealed                                               386                393
                                                Decided m favor of producer                         330                243
                                                Decided against producer                              31                71
                                                Not yet decided                                       25                79


                                             Our review of reported sodbuster and swampbuster violations showed
                                             that they were resolved in favor of the producer for reasons such as the
                                             following: (1) violations were reported in error, (2) land was not highly
                                             erodible, (3) land was cropped during 1981 to 1985, and (4) a conserva-
                                             tion system was being applied. Because these are all legitimate reasons
                                             for resolving reported violations in favor of producers, these USDA data
                                             tend to overstate the extent of violations. On the other hand, because
                                             reporting has been suspended, additional violations could be occurring
                                             but are not being identified through USDA’S enforcement and reporting
                                             process. USDA’S report further shows that benefits that had been or
                                              would be withheld totaled $970,598 for sodbusting and $843,265 for
                                              swampbusting. The number of producers that had benefits withheld was
                                              not identified.

                                             ASCSissued new instructions to state and county offices in March 1990
                                             for reporting enforcement activity that occurred prior to January 1990
                                             and monthly activity thereafter. ASCS advised us that a new national
                                             report is planned, but that its issuance date is unclear.


                                              tics procedures do not adequately monitor participating producers for
 Conclusions                                  violations of the conservation provisions. All participants do not file
                                              annual compliance certifications as required, and all participants are not
                                              included in AXS’ universe from which producers are sampled for
                                              compliance.


                                              To improve AXS’ enforcement of the conservation provisions, we recom-
 Recommendationsto                            mend that the Secretary of Agriculture require ASCS to
 the Secretary of
                                              develop controls to verify the compliance of all USDA farm program par-
 Agriculture                             l


                                              ticipants who fail to certify their compliance annually with AXS and



                                              Page 38                                GAO/RCED-90206 Conservation Compliance
Chapter 5

Enforcement Needs Improvement


                     As a result of LJSDA'Senforcement activities, the Department estimates
                     that farmers forfeited $1.8 million in farm program benefits. However,
                     USDA'S procedures do not ensure that all farm program participants are
                     included in annual compliance reviews. Because of the way conservation
                     compliance is currently administered, some producers do not file the
                     necessary forms needed by the Department to enforce these provisions
                     of the act. Further. IMA has no current national statistics on sodbuster
                     and swampbuster violations or on benefits lost due to violations. Data
                     presently used by the Department may not accurately reflect sodbuster
                     and swampbuster violations.


                     ASCS is the IJSDA agency responsible for determining whether producers
Weaknessesin ASCS’   comply with the conservation provisions, and is to obtain two docu-
Compliance           ments from producers each year that are key to its compliance-
Monitoring           monitoring process. These are the producers’ (1) certification of compli-
                     ance with the conservation provisions of the act and (2) land use report.
                     However, our review indicates that ASS does not always obtain these
                     documents. Further, in one state we visited, ASCS had not followed up on
                     suspected swampbuster violations reported by the Fish and Wildlife
                     Service.

                     On annual compliance certifications (Form AD-1026), producers must
                     identify land they have sodbusted or swampbusted or plan to convert to
                     cropland. ASCSreviews the certifications for indications of possible vio-
                     lations and, if necessary, follows up to determine whether there has
                     been a violation. Our review of 1989 certifications required from ASCS,
                     FCIC, and FIIIHA program participants in four Iowa, Kansas, Minnesota,
                     and Missouri counties showed that ASCS did not have certifications from
                     6 of the 100 ASCSparticipants, 9 of the 50 FCICparticipants, and 7 of the
                     50 FmHA participants that we checked. Annual certifications could be
                     filed with .4scs, FU(‘. or FmH.4 before 1990. Beginning in 1990, the certifi-
                     cation must be filed with xxx

                     Each year, ASCS also stllects a sample of 15 percent of the farms of pro-
                     ducers who file land use reports (Form ASCS-578) to check their compli-
                     ance with the conservation provisions. Participants in ASCSprograms
                     must submit land use reports and others may voluntarily submit them,
                     but the report is not generally required from producers who only par-
                     ticipate in FCIC or FIJIII,Iprograms. As a result, the universe from which
                     ASCSselects its sample may not include all participating producers’
                     farms. Therefore. some producers who only participate in FCIC and FmHA



                     Page36
                      Chapter 4
                      Implementation Delays and lnconsLtently
                      Applied Criteria May lledt in Further
                      Wetland Lames




                      Exemptions to the swampbuster provisions because of commenced con-
                      version determinations are sensitive issues, and require consistent deci-
                      sions These decisions can be enhanced by using the assistance available
                      from the Fish and Wildlife Service. Consultation with the Fish and Wild-
                      life Service, as required by the act and later through implementing regu-
                      lations, might have avoided the problems and controversies sometimes
                      accompanying ASGSdecisions.


                      To prevent any further loss of wetlands and to improve program lmple-
Recommendationsto     mentation of the swampbuster provisions, we recommend that the Sec-
the Secretary of      retary of Agriculture (1) monitor the application of the wetlands
                      commenced conversion criteria so the decisions made are consistent and
Agriculture           (2) enforce the requirements for the Fish and Wildlife Service consulta-
                      tions on commenced conversion decisions in order to utilize its expertise
                      in the area.


                      In terms of identifying wetlands, USM noted that it needs to make wet-
Agency Comments and   land determinations only on those lands ONor adjacent to cropland.
Our Evaluation        Therefore, not all of the 82 million acres of wetlands in the United
                      States would need to be identified according to USM. Although we pro-
                      posed a recommendation that scs complete its wetland determinations
                      by the end of 1991, USM stated that it intends to complete wetland
                      determinations as scheduled. Since USDAplans to meet its 1991
                      timeframe, we removed our recommendation. USDA also noted that the
                      identification of wetlands will not prevent them from being converted.

                      We agree with usw that the wetlands moat likely to be converted will be
                      located on or near cropland and that probably something less than 82
                      million acres would need to be identified. Nonetheless, we believe that
                      until USDAidentifies wetlands, it will be difficult for ASCSto enforce the
                      swampbuster provisions of the act and prevent wetlands from being
                      converted. Therefore, it is important that the Department complete its
                      identification of wetlands as scheduled.

                      USDA also noted that we did not adequately recognize its ongoing efforts
                      to review and correct previous commenced conversion decisions. Specifi-
                      cally, the Department told us that all commenced conversion decisions
                      are being reconsidered, that the Fish and Wildlife Service is being con-
                      sulted in instances where they were previously overlooked, and that
                      questionable commenced conversion decisions were being reopened.



                      Page 34                                   GAO/BCED4@200 Conservation Compliance
                          Less than a year later, in September 1989, ASCSreceived inquires again
                          from special interests and responded to the inquiries and appeals sur-
                          rounding these projects by reversing itself. Concerning the first project,
                          ASCSsaid that any wetlands identified to be drained in the project area
                          could receive an exception, regardless of whether construction activities
                          were underway. USDA also believed that the second project that was pre-
                          viously denied warranted an exemption because the project had been
                          planned, the farmers in the assessed area had been identified, and the
                          plan had been approved by vote before the act became law.

                          A9c9 also concluded that, for both projects, the more appropriate basis to
                          grant an exemption was that undue financial hardship would result in
                          the absence of a commenced determination because individual land-
                          owners expended funds both before and after the act’s passage, and
                          became obligated for payment of the project costs incurred. This A.%S
                          deci$on adds another dimension to the established criteria. Up to the
                          time of this decision, only costs, obligations, or activities which took
                          place before the act were considered in determining whether an exemp-
                          tion was warranted.


Documentation for         On the basis of 23 approved commenced conversion requests, we found
                          that producers provided various types of documentation in the form of
Exemptions Often Lacked   project plans, assessments, engineering or legal bills, or receipts and can-
Sufficient Information    celled checks for construction work or supplies acquired before
                          December 23, 1985. In 14 of the 23 cases, the documentation was suffi-
                          cient to verify that funds had been committed, the installation of
                          drainage measures had begun, or other criteria had been met. The nine
                          other approved requests lacked specific documentation to make a com-
                          nrsRced determination.

                          Of the requests lacking specific documentation, the primary support
                          provided in most of the cases was the tax assessment and/or the project
                          plan. However, the AEKShandbook specifically requires that the farmer
                          provide documentation, such as cancelled checks, invoices, or contracts
                          showing that the farmer has spent or is legally committed to spending
                          funds for the primary and direct purpose of converting a wetland. Fur-
                          ther, the documentation is to show to whom the funds were committed
                          and the purpose of such funds. In one of the cases we reviewed, the
                          producer furnished, and the county accepted, the tax assessment notide




                          P@ge22                                  GAO/RCRD-90.206 Conservation Compliance
                                       Chapter 4
                                       Implementation Delays and Inconsistently
                                       Applied Criteria May Result in Further
                                       Wetland Losses




Table 4.1: Changes in USDA Exemption
Criteria for Commenced Conversions     Date                  - Criteria
                                       June 24,1966            Defined that a wetland cG=was            commenced if, before
                                                               December 23, 1985, earth movrng for purposes of draining was
                                                               started, or substantral funds had been committed legally and
                                                               financially by entenng into a contract for earth moving, or otherwise,
                                                               for the conversion.
                                       Sept. 19, 1986          Added a prowsron that personswrthrn the funsdiction of a water
                                                               resources board or srmilar group project could receive an exemption
                                                               to dram a wetland If they met the followrng conditions in place of
                                                               those spelled out on June 24, 1986
                                                               1 They were or could be assessed for the actrvrtres of the drarnage
                                                               project.
                                                               2 Therr plan was approved by a vote or approval of landowners
                                                               wrthrn the project area before December 23, 1985.
                                                               3. An ASCS county committee determined that the approved plan
                                                               reasonably contemplated such person’s drarnage activrty.
                                       Nov. 20. 1986           Added to the September 19. 1966, criterra a requrrement that
                                                               substantral funds for rmplementatron must have been commrtted
                                                               before the act’s passage.
                                       Feb 4.1987               Revrsed and restated crrtena used to make wetland conversion
                                                               decrsrons and Included the followlng.

                                                                1 Deletrng ASCS county commrttee’s authority to approve cases
                                                                that were reasonablv contemolated, but were not Included rn the
                                                                drarnage plan.         ’
                                                                2 Adding that one or more of the followrng requirements had to be
                                                                met orior to December 23. 1965
                                                                - earth movrng or land clkaring had begun,,
                                                                - a contract for these actrvrtres had been srgned, or
                                                                - substantral funds had been legally commrtted.
                                                                3 Requrnng that the person’s drarnage activrty had to be
                                                                specrfrcally
                                                                        ~~-~. rdentrfred In .~~
                                                                                            the plan
                                        Sept. 10, 1987          Elrminated the term “earth moving” and changed language to           -
                                                                encompass actrvrtres such as draining, dredgrng, leveling, fillrng, or
                                                                other manrpulatron that results rr- impairing or reducing the flow,
                                                                crrculatron, or reach of water that was actually started before
                                                                December 23, 1985. Further deftned what acts constrtute the legal
                                                                commrtment of funds to Include those listed above, as well as
                                                                purchasing construction supplies or materials for the primary and
                                                                drrect purpose of converting the wetlands. Added a
                                                                provrsron that the Frsh and Wrldlrfe Service must be consulted on
                                                                each request for a commenced determrnatron.

                                                                Added the requirement that persons must show that the wetland
                                                                conversron was the basis for a frnancral obltgation, and a specific
                                                                assessment for protect constructron or legal obligation to pay a
                                                                specrfrc assessment was made prior to December 23, 1985 Also, it
                                                                must be shown that efforts toward the completron of the conversron
                                                                actrvrty have continued on a regular basrs.
                                        Dec. 8, 1989            Added procedures for handlrng drsagreements between SCS and
                                                                the Frsh and Wrldlrfe Service on wetland matters and late filed
                                                                renIIAStS
                                                                requests




                                        Page 30                                           GAO/RCED-90206 Conservation Compliance
                     Chapter 4
                     Implementation Delays and Inconsistently
                     Applied Criteria May Result in Further
                     Wetland Lasses




                     participants. These wetlands would be most susceptible to cropland con-
                     version. While this seems reasonable, scs has no estimate of the amount
                     of wetland acres it expects to identify for compliance with the act.

                     USDA officials told us that they were able to make only a limited number
                     of wetland determinations because of constraints on staff resources and
                     the fact that XX gave priority to identifying highly erodible land and
                     developing conservation plans to meet the January 1990 deadline set by
                     the act. Nonetheless, most of the wetland determinations that have been
                     made to date reflect only those cases where farmers have indicated that
                     they had converted or planned to convert wetlands. When wetlands are
                     drained, flood control and water quality can decrease, fish and wildlife
                     habitat decline, and recreational opportunities can be lost. scs’ present
                     goal is to complete wetlands determinations by the December 31, 1991
                     deadline.


                     Wetland conversions started before the act’s passage are exempted from
Wetlands Exemption   its provisions. Exemptions are granted if the criteria for commenced
Criteria Changed     conversion are met. However, the criteria for exemptions, notably those
Frequently           involving group projects, have changed frequently as ASCS developed the
                     final program rules and regulations. The lack of firm and consistent cri-
                     teria from the outset of the program has raised questions about some
                     decisions and created controversy.

                     AXS’ latest national statistics reported that producers requested 5,259
                     exemptions for commenced conversions. Of these requests, 45 percent
                     were approved, 13 percent. were denied, and the remaining 42 percent
                     were pending when national reporting was suspended in April 1989.
                     USDA officials told us that reporting was suspended because they
                     believed the data received from states were not accurate.

                     We found differences in reporting procedures that tend to overstate pro-
                     gram statistics on the number of commenced conversion requests and
                     exemptions granted. In two of the six counties visited, we found that the
                     reported activity does not reflect the actual activity. For example, while
                     1 county reported that 84 commenced conversion requests were denied,
                     our review of the files showed that the county had received only 4
                     requests. Another county reported the approval of 136 requests, but
                     records showed that the county received just 10 requests. These discrep-
                     ancies resulted from requests by water resource districts on behalf of a




                     Page28                                     GAO/KCELNO-206 Conservation Compliance
                      Chapter 3
                      Planned Conservation Systems Will Reduce
                      Erosion, but AR May Not Re Implemented by
                      the Deadline




                      If the Congress wishes to increase the protection of erodible lands, it
Matters for           may want to consider requiring that conservation systems applied to
Congressional         sodbusted land, whether or not they are converted from native vegeta-
Consideration         tion, limit erosion to no more than the soil loss tolerance level. Land used
                      for planting a nonagricultural crop during 1981-85 in a long-term rota-
                      tion approved by scs should be excluded.


                      With regard to our first recommendation, we initially proposed that scs
Agency Comments and   determine which plans are likely to be implemented by 1995 in addition
Our Evaluation        to prioritizing its cost-share funds. In commenting, USDA said that it
                      believes that all plans are likely to be implemented, and that the scs
                      effort has been based on that assumption. In support of this belief, the
                      Department noted that in many cases the continued eligibility for partic-
                      ipation in IJSDA programs should be sufficient incentive for implementing
                      the plans. USDA also commented that there is no requirement or expecta-
                      tion that cost-share funds would be sufficient to provide for all of the
                      planned conservation practices.

                      As a result of the Department’s comment on this recommendation, we
                      removed our reference to SCS’determining which plans will be imple-
                      mented since IJSDA believes all plans are likely to be implemented. How-
                      ever, because the Department believes that not all conservation
                      practices can be funded, it is all the more important that its limited cost
                      share funds are prioritized to achieve the greatest conservation benefit.

                      In commenting on our second recommendation, USDA noted that scs is
                      establishing a national sampling system for reporting progress so that
                      details of accomplishments would be readily available. As a result of
                      this comment, we made adjustments to the report where appropriate.
                      However, we did not change our recommendation because this sampling
                      system is not yet in place.




                       Page 26                                    GAO/RCEL%90.206 Conservation Compliance
                                          Chapter 3
                                          Planned Gmaervation systems will Redwe
                                          Erosion, but AR May Not Be Implemented by
                                          the Deadline




                                          assistance to producers in implementing conservation practices. In addi-
                                          tion, states have various cost-sharing conservation programs that are
                                          coordinated with USDA’S administration of its cost-sharing programs.

                                          scs had not prepared a national estimate of the cost of installing conser-
                                          vation systems. However, scs representatives in Iowa, Kansas, and Mis-
                                          souri estimated that the shortage of cost-share funding in their states
                                          during the next 5 years will be about $409 million. Table 3.3 shows the
                                          scs representatives’ estimated total installation costs, federal and state
                                          cost-share funding, and the shortage of these funds.

Table 3.3: Estimated Cost-Share Funding
Needed for Conservation Plans in Iowa,    Dollars    in mllllons____          ~~~~~_~..____.       _____-                           -___-
Kansas, and Missouri                                                                                          Amount projected
                                                                           Total         Amount needed          to be available
                                                                   installation             from federal/          from federal/    Estimated
                                          State                            costs           state sources         state sources0      shortage
                                          Iowa                             -- $808                   $404b                   $87            $317
                                          Kansas                                134                     67c                    46               21
                                          Missouri                              268                    1766                   105               71
                                          Total                            $1,210                    9647                   $238            9409

                                          ‘Based on current funding projected for fiscal years 1990 through 19%.

                                          beased on 50percent          of total costs.

                                          ‘Based on combined federal and stale cost-sharing at 50 percent of total costs.

                                          %ased on combtnad federal and state cost-sharing at 50 to 75 percent of total costs. The percentage
                                          varies depending on the conservation practice and the county.


                                          The extent that scs shares the costs of implementing conservation plans
                                          with a producer varies between states. scs can share up to 75 percent of
                                          the cost of specified conservation practices not to exceed an established
                                          maximum amount. However, scs state and county offices may establish
                                          priorities and approve cost-sharing at less than 75-percent if they
                                          choose to do so. For example, the Missouri scs office estimated it would
                                          share from 50 to 75 percent of the costs, while Kansas limited federal-
                                          state cost sharing to 50 percent of the costs so that assistance could be
                                          provided to more producers.

                                          Providing additional cost-share funding may not necessarily enable scs
                                          to assist producers in instaIling all the conservation systems planned by
                                          the 1995 deadline. For example, an xs assistant state conservationist in
                                          Missouri said that additional cost-share funds could not be effectively
                                          utilized without the additional staff needed to provide the related tech-
                                          nical assistance. An scs state conservationist in Kansas also noted that


                                           Page 24                                                   GAO/RCED9IMG8 Conservation Cmnpliance
                                      Chapter 3
                                      Planned Conservation Systems Will Reduce
                                      Erosion, but AR May Not BP Implemented by
                                      the Deadline




Table 3.1: Examples of Planned Soil
Savings Under Each Conservation       Figures in tons per acre per year
Alternative                                                                           Erosion         Savings       Erosion
                                      Conservation   alternative                  before plan   based on plan    after plan
                                      Conservation   reserve program
                                      Field 1                                            74 7             74.0          0.7
                                      Field 2                                            41 6             41.3          0.3
                                      Field 3                                            100               90           10
                                      Conservation   system to meet T level
                                      Field 4                                            74.7             67 6          6.9
                                      Field 5                                            41 6             36 1          55
                                      Field 6                                            100               50           5.0
                                      Conservation   system to meet
                                      alternative level
                                      Field 7                                            74 7             60.9         13%
                                      Field 6                                            41 6             34.9          67
                                      Field 9                                             inn              sn            5f-l




Estimated Soil Losses                 While most conservation plans are designed to reduce erosion on
                                      cropland, our sample data show that some conservation plans were for
                                      sodbusting. In other words, some producers broke out new cropland and
                                      thus had to develop a conservation plan. Of the 354 fields contained in
                                      the conservation plans we reviewed for 58 farms, 13 sodbusted fields
                                      showed increased soil losses (i.e., soil erosion was higher after the devel-
                                      opment of the conservation plan for the sodbusted acres than it was
                                      prior to being converted to cropland). Plans to bring four fields to the T
                                      level indicated increases in expected losses ranging from 1 to 2 tons per
                                      acre per year. Plans for the nine remaining fields, which used the alter-
                                      native level, indicated increased losses ranging from 4 to 5 tons per acre
                                      per year.


                                      XX estimates that it will not, have the staffing and cost-share funding
Producers May Not Be                  needed to assist producers in implementing conservation plans (on the
Able to Implement                     135 million acres covered) by the deadline of January 1, 1995. scs offi-
Conservation Plans by                 cials believe this may limit, producers’ ability to fully implement conser-
                                      vation plans by the required date, and they would like the deadline
1995 Deadline                         extended to about 2000 If plans are not implemented as required by the
                                      act, soil savings, associated with reduced erosion, will be less than
                                      anticipated.




                                      Page 22                                       GAO/RCRD-90206 Conservation Compliance
                                            chapter 3
                                            Planned co~ervation systems will Reduce
                                            Erosion, but AU May Not Be Implemented by
                                            the Deadline




                                            all producers could elect to meet the alternative requirement without
                                            showing economic hardship.2

                                            While not required, some producers plan to reduce soil erosion to the T
                                            level. We reviewed a sample of conservation plans for 58 farms from a
                                            universe of 4,575 farms (covering 548,189 acres) in 6 counties in Iowa,
                                            Kansas, Minnesota, Missouri, and North Dakota.3 As shown in figure 3.1,
                                            our sample indicates that, in these 6 counties as a whole, producers plan
                                            to meet the conservation requirements by enrolling about 37 percent of
                                            their acres in the conservation reserve, reducing erosion to the T level
                                            on about 35 percent of the acres, and reducing erosion to the alternative
                                            level on the remaining 28 percent of the acres.



C&servation  Applications Planned in
Counties We Visited (Percentage of Acres)                                                             Reduced erosion to an alternative level




                                                                                                      Reduced erosion through the
                                                                                                      conservation reserve program




                                                                                                      Reduced erosion to T
                                            Note:Samplingerrors for these data are as follows conservation reserve program, 21 9. conservation
                                            systems to reduce erosbon to T, 15 7, conservation systems to meet an alternative level, 17.7.
                                            Sampling errors lndlcate the range wIthIn which the actual value would lkkely fall at the 95.percent confl-
                                            dence level (IX ,95 times out of 100)
                                            Source: GAO analyw     of conservation   plans


                                            “An exceptionis highly ercdible fields convertedfrom native rang&m& or woodlandvegetation.
                                            Both must meetthe T level
                                            “Thesedata on soil erosioncannotbeextrapolatedto other countiesin the United States.See
                                            appendii I for details about our sample.



                                            Page 20                                                  GAO/RCRIMO-206 Conservation Compliance
Chapter 2
The Act Does Not Protect All Hiiy   Emdible
Land and Wetlands




In response to this comment, and realizing that USDA may have short-run
resource constraints, we did not recommend that the Department change
its criterion. Rather, we directed our observation about the amount of
land covered by USDA’S criterion to the Congress. If the Congress wishes
to protect more erodible land, considering the increased costs, lowering
the USDA criterion could be used to do so. For example, about 75 million
acres of land are eroding at 5 to 8 times the soil tolerance level, and
controlling erosion on these lands could produce significant soil savings.




Page 18                                       GAO/RCEDS@206 Conservation Cmnphnce
                                                                                                                                    -
                                       Chapter 2
                                       The Act Doea Not Prutect All Highly lhdible
                                       hd and Wetlands




Figure 2.2: Erosion Potential of the
N&ion’s 423 Million Cropland Acres




                                                                                           Highly erodible land with erosion
                                                                                           potential of 8 Tor more (142 million
                                                                                           acres)

                                                                                           Other erodible land with erosion potential
                                                                                           of less than 8 T (281 million acres)




                                       Source: GAO estimate based on 1987 National Resource Inventory, USDA, and Jan. 1990 Food Sectmty
                                       Act Progress, USDA


                                       In addition to the criterion used by USDA, in some instances, the act
                                       allows producers to convert highly erodible land and wetlands without
                                       the loss of farm program benefits-further      limiting the protection of
                                       fragile lands. For example, with regard to sodbusting, a loss of benefits
                                       does not occur unless a producer converts highly erodible land and
                                       plants an agricultural commodity on the land without applying an
                                       approved conservation system. Similarly, concerning swampbusting, a
                                       loss of benefits does not occur unless a producer converts wetlands and
                                       plants an agricultural commodity on the land. In both cases, benefits are
                                       not lost if the producer does not plant an agricultural commodity during
                                       the crop years that he/she chooses to participate in a USDA farm pro-
                                       gram. Yet, in the case of converted wetlands, the environmental value of
                                       the wetlands is lost. The act does not require farmers to restore con-
                                       verted wetlands to remain eligible for federal farm program benefits.
                                       Because of the extensive nature of the task, we did not attempt to iden-
                                       tify instances where farmers actually drain wetlands and still obtain
                                        federal farm benefits. Nonetheless, it appears that the Congress is con-
                                        sidering, as part of its changes to the Food Security Act, remedying this
                                       situation.4




                                        4TheHousepasseda bill in August 1990which will withhold benefitsfrom programparticipants who
                                        convert wetlandsfor the purposeof producingan agricultural commodity.



                                        Page 16                                            GAO/RCED-96266 Conservation Compliance
                                               Chapter 2
                                               The Act Does Not Protect All H@ly Emdibk
                                               Land and Wetlands




Figure 2.1: Amount of Cropland and
Wetlands in the United States (Total
Surface of the tinted States Is 1 94 Bullion
Acres)

                                                                                                Cropland


                                                                                                4%
                                                                                                Wetlands

                                                                                                Federal Lands




                                                                                                2%
                                                                                                Water Areas

                                                                                                Other Land Uaes

                                               Note Data exclude Alaska

                                               Source 1987 NatIonal Resource Inventory, USDA


                                               Only these lands that USDA classifies as highly erodible or wetlands and
                                               that are farmed or planned to be farmed by USDA participants are cov-
                                               ered by the act. Producers who do not participate in USDA farm programs
                                               are not required to comply with the act’s conservation provisions.2


                                               The act allows USDA to establish criteria for classifying land as highly
Other Fragile Lands                            erodible in carrying out the conservation compliance provisions. USDA’s
Remain Unprotected                             criterion requires land to have the potential to erode at least eight times
                                               the soil loss tolerance level to be classified as highly erodible for the
                                               conservation compliance and sodbuster provisions. This criterion pro-
                                               tects the most erodible land. In contrast, usw used a broader eligibility
                                               criterion for removing land from production and enrolling it in the con-
                                               servation reserve program for USDArental payments. This criterion
                                               included the land’s potential and actual erosion, current and future use,
                                               and potential to flood.


                                                ‘According to the National ResearchCouncil’sreport, AkematiVe&#mkwe, W39,about 70 percent
                                                of the nation’s croplandwas enrolled in federal commodity program at the time of its report.



                                                Page 14                                         GAO/RCXDSG206 CoMervatlon Compliance
interviewed USDArepresentatives at the offices identified above. We also
sampled ASCSand scs county office implementation records to determine
whether producers’ annual certifications of compliance were received
from USDA program participants, whether highly erodible land and wet-
land determinations had been made, whether producers had developed
conservation plans and determined their effect on soil erosion and
farming practices, and the circumstances of commenced conversion
requests and decisions and whether USFWS had been consulted.

To determine how USDA enforced the conservation provisions and how
many producers lost benefits, we reviewed ASCSenforcement reports and
reporting procedures, and ASCS’and KS compliance-monitoring proce-
dures. We interviewed representatives at the offices identified above,
and we sampled ASCSand scs county office records to determine the rea-
sons why violations occurred and were appealed and overturned. Sam-
ples were also selected to look for unreported violations and to
determine whether USFWS had been consulted on wetland decisions.

To identify and recommend changes needed in the conservation provi-
sions and in their implementation, we reviewed the conservation provi-
sions of the act, the implementing regulations, USDA’S procedures, and
various implementation and enforcement records and reports; inter-
viewed USDA representatives at the offices identified above; obtained
opinions from representatives of environmental and farm organizations;
and analyzed the results of the samples discussed above.

We made our review in accordance with generally accepted government
auditing standards from July 1989 through February 1990. As agreed
with the Chairman’s office, we obtained oral comments on a draft of this
report from the Department of Agriculture.




Page 12                               GAO/RC~~ZO6    Conservation Compliance
                                          -
                 Chapter1
                 Introduction




                 level. The USDA'S Soil Conservation Service (SCS) must certify that the
                 plan is technically correct, and the local conservation district must
                 approve the plan.

                 Producers who plant an agricultural commodity on existing cropland
                 must have filed an approved soil conservation plan with the local scs
                 and have begun actively applying the plan by January 1,199O. They
                 must fully apply the plan by January 1, 1995.”

                 Producers who plant an agricultural commodity on land converted to
                 cropland after the act’s passage (Le., sodbuster) must file an approved
                 conservation plan with the local scs and fully apply the plan before
                 planting.


Swampbuster      The swampbuster provision applies to naturally occurring wetlands.
                 Producers cannot plant an agricultural commodity on naturally occur-
                 ring wetlands that were converted to cropland after December 23, 1985.
                 However, certain wetlands are exempt from the swampbuster provision,
                 such as: wetlands on which conversion was commenced before
                 December 23, 1985, but not yet completed,7 and wetlands on which the
                 production of an agricultural commodity is possible as a result of nat-
                 ural conditions, such as drought.


Penalties and    Violators of the act’s conservation provisions lose their eligibility to par-
                 ticipate in USDA farm programs. Eligibility is lost during the crop year of
Administration   the violation. The programs include: price supports or payments, farm
                 program loans, crop insurance, disaster payments, and payments for
                 storage of agricultural commodities.

                  Within USDA, scs and the Agricultural Stabilization and Conservation
                  Service (ASCS) administer and enforce the act’s conservation provisions.
                  IJSDA'S Farmers Home Administration    (FWIA) and Federal Crop Insur-
                  ance Corporation (FCIC) are to coordinate with ASCSto ensure that pro-
                  ducers participating in their programs are in compliance with the act’s
                  conservation provisions The act also requires scs and ASG to consult

                  “Producerswho did not prepare:Lconservationplan by .January1, 1990,mustdevelopand apply an
                  approvedplan when growing their first crop.Producerswho did not participate in IJSDAprogmms
                  between1986and 1989have rmtll Jm~ary 1, 1996,to apply their plans.
                  7Prcducenwho started to co~mw wetlandsprior to the act are grantedexemptionsto the
                  swampbusterprovision if they meetcertain cntena Theseexemptionsare called “commenced
                  conversions”



                  Page10                                          GAO/RCED-90.296ConservationCompRmce
Chapter 1                                                                                                            -
Introduction


                   The Food Security Act of 1985 (P.L. 99-198, Dec. 23, 1985) contains con-
                   servation provisions intended to reduce soil erosion and protect wet-
                   lands by removing incentives for producing agricultural commodities on
                   highly erodible land or converted wetlands. By removing these incen-
                   tives, the Congress intended to: reduce soil loss due to wind and water
                   erosion, assist in preserving the nation’s wetlands, reduce sedimentation
                   and improve water quality, curb the production of surplus commodities,
                   and protect the nation’s long-term capability to produce food and fiber.

                   Before the act became law, the U.S. Department of Agriculture (USDA)
                   estimated that

               . 3.1 billion tons of soil were eroding annually on much of the 420 million
                 acres of cropland in the United States;
               l 3.7 million acres of land were being converted from uses such as pas-
                 ture, range, and wetlands to cropland annually; and
               l about 153 million acres of noncropland (including 5.2 million acres of
                 wetlands) had a medium to high potential for conversion to cropland.

                   The act included provisions on conservation compliance, “sodbuster,”
                   “swampbuster,” and conservation reserve. The conservation compliance
                   provisions protect highly erodible cropland’ farmed during 1981 to
                   1985, while the sodbuster and swampbuster provisions, respectively,
                   protect highly erodible land and wetlands2 that may be converted to
                   cropland after the act’s passage.

                   This report covers the first three provisions which impose conservation
                   requirements on producers who participate in USDA farm programs. We
                   reported on the act’s fourth provision, the conservation reserve pro-
                   gram, in November 1989.:’




                   ‘USDAclassifieshighly erodibleland as land consistmgof fields in which a mmimumof one-third or
                   50 acresof the field contain so11with a potential to erodeat least 8 tunesthe soil losstolerancelevel.
                   The soil losstolerancelevel is defined asthe rate at which the soil can erodeand maintain continued
                   productivity.
                   ‘USDAclassifieswetlands as areaswith a predommanceof soils that are mundatedor saturatedby
                   water to the point where the soil cansupport water-loving plants.
                   3F~ Programs:ConservationReserveProgramCould Be LessCostly and More Effective (GAO/
                       90-13, Nov. 16, 1989).



                   Page 8                                                GAO/RCED-90-206Conservation Compliance
Contents


Executive Summary                                                                                      2

Chapter 1
Introduction                  Why Soil Erosion and Loss of Wetlands Are a Problem
                              How the Conservation Provisions Work
                              Objectives, Scope, and Methodology                                      11

Chapter 2                                                                                             13
The Act Does Not              Land Protected by the Act
                              Other Fragile Lands Remain Unprotected
                                                                                                      13
                                                                                                      14
Protect All Highly            Conclusions                                                             17
Erodible Land and             Matters for Congressional Consideration                                 17
Wetlands                      Agency Comments and Our Evaluation                                      17


Chapter 3                                                                                             19
Planned Conservation          Producers Have Prepared Conservation Plans for Most
                                   Highly Erodible Cropland
                                                                                                      19
Systems Will Reduce           Soil Savings Will Occur as Conservation Plans Are                       21
Erosion, but All May               Implemented
                              Producers May Not Be Able to Implement Conservation                     22
Not Be Implemented                 Plans by 1995 Deadline
by the Deadline               Conclusions                                                             25
                              Recommendations to the Secretary of Agriculture                         25
                              Matters for Congressional Consideration                                 26
                              Agency Comments and Our Evaluation                                      26

Chapter 4                                                                                             27
Implementation         Implementation of Swampbuster Provision Has Been                               27
                            Delayed
Delays and             Wetlands Exemption Criteria Changed Frequently                                 28
hCOIlSiSkntly Applied ASCS Did Not Always Consult With the Fish and Wildlife                          33
Criteria May Result in Con~~~%‘~                                                                      33
Further Wetland        Recommendations to the Secretary of Agriculture                                34
Losses                 Agency  Comments and Our Evaluation -                                          34




                              Page 6                               GAO/RCED-9024J6 Conservation CbmpUance
                             In some instances, the law allows farmers to convert highly erodible
                             land or wetlands to cropland without losing federal farm program bene-
                             fits. Farmers who convert these lands can still receive farm program
                             benefits in any year that they do not plant on them. In other years,
                             those farmers can plant on the converted lands, provided they forego
                             participating in federal farm programs. In either case, the lands are lost
                             and farmers are not required to restore them to regain their right to
                             farm program benefits.


Conservation Plans May       Our review of a limited sample of conservation plans in six counties in
Not Be Implemented and,      five states shows that soil erosion should be reduced on most of the
                             fields ln these counties2 However, uso~ expects a shortage of staff and
Thus, Soil Savings May Be    funding used to provide farmers with technical and financial assistance
Less Than Anticipated        in applying conservation systems. scs told us that field office staffing
                             will be 37 percent below the level needed during fiscal years 1990
                             through 1994. Also, although scs has no national estimate of the cost to
                             install conservation systems, scs personnel in Iowa, Kansas, and Mis-
                             souri estimate that the shortage in funding assistance in their states
                             during the next 6 years will be about $409 million. As a result, farmers
                             will not apply conservation systems on all of the 135 million acres
                             planned, or they may apply less effective and less costly systems.


Implementation of            Given limited staff resources, USDA deferred making wetland determina-
Wetland Provisions Slow      tions because it gave priority to developing conservation plans which
                             were required by 1990. To date, US~Ahas identified about 7.5 million
and Inconsistently Applied   acres of wetlands. USDA estimates that there are about 82 million acres
                             of wetlands on nonfederal lands in the continental United States. Of
                             these 82 million acres, USDA plans to make wetland determinations only
                             on cropland and land adjacent to cropland on farms of USDA participants.
                             While this is reasonable, USDA does not know how much of this acreage
                             is susceptible to cropland conversion. Until wetland acres are identified,
                             USDA cannot ensure that they are protected as required by the act. IJSDA
                             expects to complete wetland determinations by December 3 1, 1991.

                             USDA  has amended or modified the criteria for exempting wetland con-
                             versions several times since it issued interim rules in 1986. As a result,
                             USDA did not consistently apply the criteria to determine which wetlands
                             can be drained without violating the act. USDA also did not consult with


                             ?hese data on soil savingscannot be extrapolatedto other countiesin the United States.



                             Page 4                                             GAO/RCTl?DWm Conservation Compliance
Executive Summary


                   Every year billions of tons of soil erode from the nation’s cropland while
Purpose            millions of other acres are converted into new cropland. To address this
                   problem, the Food Security Act of 1985 requires farmers who partici-
                   pate in federal farm programs to reduce erosion on highly erodible
                   cropland and, with certain exceptions, prohibits the conversion of wet-
                   lands to cropland.

                   The Chairman of the House Committee on Agriculture asked GAO to
                   review the Department of Agriculture’s (USDA) administration of the
                   act’s conservation provisions by focusing on, among other things, (1) the
                   number of acres of land affected, (2) the implementation of conservation
                   plans to reduce soil erosion, and (3) the implementation of the wetland
                   provisions to reduce wetland conversions.


                   Before the act, about 3.1 billion tons of soil eroded annually on over 420
Background         million acres of cropland in the United States, and pasture, range, wet-
                   lands, and other lands were converted to cropland at a rate of 3.7 mil-
                   lion acres a year. Soil erosion gradually reduces the productivity of land,
                   increases sedimentation of water bodies, and damages surface and
                   groundwater quality. When wetlands are drained, flood control and
                   water quality can decrease, fish and wildlife habitat decline, and recrea-
                   tional opportunities can be lost.

                   The act requires farmers to conserve highly erodible land and wetlands
                   by linking their conservation activities with eligibility for USDA farm
                   program benefits. To be eligible, farmers must (1) develop plans to
                   apply approved conservation systems by 1995 to reduce erosion on
                   highly erodible lands they farmed between 1981 and 1985 and (2) not
                   convert and farm certain wetlands. Farmers who plant on highly erod-
                   ible land that was not previously farmed (the act’s sodbuster provision)
                   must apply a conservation system before planting. In general, farmers
                   cannot plant on naturally occurring wetlands that were converted to
                   cropland after the act, (the act’s swampbuster provision).

                   IJSDA is responsible for administering these provisions, enforcing compli-
                   ance, providing technical assistance to producers, and assisting with
                   funding to implement conservation measures.


                   IJsing IJSDA'S criterion, the act covers about 142 million acres of highly
Results in Brief   erodible farmland. Opportunities exist to increase this amount. First,
                   L'SDA'S highly erodible land criterion does not include certain lands with