Other Ag News: Stewarding Success: IRA Funding is Cultivating New Conservation Acres and Farmers

EDITOR’S NOTE: On October 9, 2024, NSAC released Stewarding Success: CSP Under the 2018 Farm Bill, a comprehensive analysis of the Conservation Stewardship Program (CSP) over the course of the Agriculture Improvement Act of 2018 (2018 Farm Bill). The report offers an in-depth analysis of CSP’s enrollment trends, conservation practices supported, and funding impacts, including the effects of the Inflation Reduction Act (IRA) of 2022. This post is the second in a series of five blog posts highlighting the key findings of the report and offering a deep dive into the success of the IRA within CSP.

The Conservation Stewardship Program (CSP) is a voluntary program run by the US Department of Agriculture (USDA) through its Natural Resources Conservation Service (NRCS). CSP aims to enhance natural resources while maintaining profitable agricultural production. It does this by providing financial and technical assistance to farmers for actively managing and expanding conservation activities even while they work their lands for production. The conservation title of the Farm Bill provides funding for CSP, but the program received a significant boost on top of its farm bill funding from the Inflation Reduction Act (IRA) of 2022. NSAC’s analysis confirms that the IRA has been a resounding success in CSP, bringing thousands of new farmers into this vital program and expanding its conservation footprint.

The IRA provided an additional $19.5 billion over five years to bolster USDA conservation programs, including $3.25 billion dedicated specifically to the CSP. The IRA funds target climate-smart agriculture and forestry, with FY2023 marking the first year that these funds were used to fund CSP contracts that included climate-smart practices. 

NRCS successfully spent 99.84% of the IRA dollars they were allocated for CSP in FY2023. This included 2,407 CSP contracts (22% of all FY2023 contracts), over 3.3 million new acres (22% of all FY2023 acres) (see Figure 1), and nearly $171 million expended directly on climate-smart agriculture and forestry practices in CSP, with the additional $79 million of IRA funds allocated to CSP supporting technical assistance for all contracts signed. Promisingly, socially disadvantaged producers accounted for 23% of total CSP acres funded by the IRA FY2023. Without IRA funding, the footprint of CSP in 2023 would have been 22% smaller, and thousands of farmers, including many socially disadvantaged producers (SDA), would have been left out of CSP.

CSP’s IRA funds were used to support well-established and popular conservation practices (see Figure 2). IRA funds are specifically targeted for conservation practices that contribute to climate mitigation in agriculture. All Climate-Smart Agriculture and Forestry (CSAF) practices are traditional conservation methods for addressing resource concerns like water quality, erosion control, soil health, and wildlife habitat preservation. However, CSAF practices also reduce greenhouse gas emissions or sequester carbon. Notably, eight of the ten practices that received the most IRA funding in FY2023 were also among the top practices supported by CSP’s baseline funding from the Farm Bill, demonstrating the clear ability of CSP to accomplish both classic conservation work and GHG mitigation with funds targeted at addressing climate change. 

Cover crops, prescribed grazing, nutrient management, no till, reduced tillage, and all of the other CSAF practices that received the most IRA funding in FY2023 are well established conservation practices with a wide suite of benefits. These practices contribute to both climate mitigation and improvements in water and soil quality, making them highly impactful. 

In addition to conservation practices, IRA funds were directed toward specific enhancements that promote climate-smart outcomes. An enhancement refers to a specific conservation activity that builds upon or improves existing conservation practices to provide additional environmental benefits. These enhancements not only support climate-smart agriculture but also enhance productivity and resilience on farms, contributing to the overall sustainability of agricultural ecosystems. For instance, enhancing the Nutrient Management practice to focus on improving nutrient uptake efficiency was the enhancement that received the most IRA funds in FY2023. This enhancement supports improved water quality as well as agronomic and economic efficiency for producers in addition to serving climate-smart goals. 

IRA-supported practices and enhancements are highly impactful. They improve climate outcomes while also offering direct conservation benefits to improve water quality, soil quality, and other resource concerns. 

IRA funding also spurred interest in CSP bundles, which are sets of advanced conservation activities designed to promote more comprehensive environmental stewardship. While not listed on the CSAF practices list, nearly all bundles are eligible for IRA funding. In FY2023, the Climate-Smart Advanced Soil Health Bundle—aimed at enhancing soil health through practices like increasing plant diversity and minimizing soil disturbance—received $3.3 million in IRA funding, making it one of the top-funded bundles in both the farm bill and IRA funding pools. That same year, it also received more IRA funding than popular, single practices like cover cropping, illustrating strong interest from farmers in implementing multiple, complex conservation activities at once. It is significant that only the bundle explicitly labeled as “climate smart” saw this level of demand in FY2023, signaling a need for better communication from NRCS to farmers regarding the eligibility of bundles for IRA funding. For this reason, NSAC advocates for the inclusion of all eligible bundles in future CSAF lists to ensure broader adoption and clearer messaging surrounding IRA eligible bundles.

Every state except Alaska used IRA to fund additional CSP contracts. This new funding provided a vital boost for CSP enrollment in every state and brought new farmers and acres into the program, increasing the conservation footprint across the US. NSAC considers this a massive success as NRCS mobilized to spend 99.84% of the IRA dollars allocated to CSP and enroll an additional 3 million acres, all in less than a year after the IRA’s passage.

In FY2023, the states spending the most IRA funding for CSP activities were Arkansas, Mississippi, South Dakota, North Dakota, and Kansas. In contrast, and unsurprisingly, smaller Eastern states such as Maryland, Connecticut, New Jersey, Rhode Island, and Massachusetts saw the lowest IRA spending levels. Interestingly, IRA funds were widely utilized in many Western states, despite concerns that climate-smart agriculture practices, as defined by NRCS, would not be of interest to Western producers. The data indicates that these concerns were largely unfounded, as many Western states successfully obligated millions of dollars of IRA funding. Many Western states obligated total dollar amounts comparable to Midwestern states with major agricultural economies. The IRA’s influence on CSP contract funding was notable across the country, bringing new farmers and new acres into the program in every state.

While total funding spent in each state is an important indicator of the IRA’s success, looking at the percentage of a state’s total contracts funded by IRA is also informative, particularly in smaller states that spend fewer CSP dollars year over year. New Jersey, Maine, and Arizona had the highest percentage of their total FY2023 CSP contracts funded by the IRA, while Nevada, Connecticut, Delaware, and Maryland had the lowest, with some data suppressed. Ultimately, nearly every state had at least 10% of their FY2023 contracts funded by the IRA. 

This wide-reaching impact of IRA funds illustrates its success in bolstering CSP across the country, while clearly showing that climate-targeted funds are helpful to producers in every state.

The NRCS defines socially disadvantaged producers (SDA) as producers who belong to groups that have been subject to racial or ethnic prejudice because of their identity as members of a group, without regard to their individual qualities. Those groups include African Americans, American Indians or Alaskan natives, Hispanics, and Asians or Pacific Islanders. The 2018 Farm Bill includes a set-aside requiring that 5% of CSP funds be allocated to socially disadvantaged producers. Encouragingly, socially disadvantaged producer enrollment supported by IRA funds far exceeded this amount. 

Socially disadvantaged producers accounted for 23% of total CSP acres funded by the IRA FY2023, a much higher percentage than the 9% of total CSP acres enrolled by socially disadvantaged producers through general farm bill funds in FY2023. The high proportion of IRA-funded acres enrolled by socially disadvantaged producers is extremely encouraging. It shows that increased CSP funding from the IRA helped bring more acres managed by underserved producers into CSP, and suggests that these producers may especially see the value in climate-smart practices. While more information is needed to fully understand this jump, it may be the initial influence of several years worth of Equity in Conservation Outreach Cooperative Agreements administered by NRCS to help trusted third party organizations connect underserved producers to conservation programs. These agreements were launched in years just before and during the initial availability of CSP IRA funding.

The IRA has significantly enhanced the reach and efficacy of CSP, with a focus on climate-smart agriculture practices. NSAC’s analysis illustrates that the IRA has been a resounding success within CSP. The allocation of additional, climate-focused funds has driven the adoption of both traditional and advanced conservation activities while bringing a greater proportion of underserved producers into the program than in years prior. Going forward, improving communication and awareness around climate mitigation tools will be key for continued success. This includes clear and consistent communication from NRCS regarding all conservation activities eligible for IRA funding, especially bundles. 

Further, the first year of IRA spending has laid the foundation for Congressional to replicate and build on the successes of FY23 in perpetuity. To do this, NSAC advocates for Congress to:

• Permanently place all available IRA funding in conservation programs’ baseline budgets, and.
• Permanently establish climate change mitigation targeting in CSP and all other major conservation programs.

This is the second in a series of five blog posts that examines the findings of the report in greater detail. Other posts in the series examine:

• a national overview of the CSP program 
• the engagement of historically underserved farmers,
• the impact of changing CSP contract renewal policies, and 
• a detailed state-by-state deep dive

The full report can be found here.

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