EQIPing Factory Farms With Your Taxes

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With government cost-cutting all the rage, here’s four important letters D.C. decision- makers should keep in mind: EQIP. It stands for “Environmental Quality Incentives Program.” A benign sounding name, but as a report released today by the Campaign for Family Farms and the Environment (CFFE) makes clear, it has evolved into a major subsidy for highly-polluting industrial livestock operations. It doesn’t have to be this way.

EQIP was established in the 1996 Farm Bill as a cost-share program targeted at family farmers who wanted to incorporate conservation practices into their operations. The USDA program has done a lot of good over the years. For example, Minnesota livestock farmers who wanted to establish environmentally-friendly grass-based production systems have used EQIP funds to put in fencing, deep-rooted pasture grasses and erosion-free animal lanes, among other things.

The original EQIP initiative capped per-farm payments at $10,000 annually, or $50,000 over five years. Overall funding for the progam was $1.3 billion between 1996 and 2002. Also, back then EQIP funds could not be used to construct manure lagoons and other storage facilities, which have proven to be an archaic, inherently flawed way to deal with waste.

Brad and Leslea Hodgson have used EQIP to make the highly-erosive acres on their southeast Minnesota farm less of a threat to the clarity of the Root River. Through EQIP they received $4,700 in cost-share funds to erect fencing and put in water lines for their grass-based beef operation. The result? During the catastrophic floods that hit that area in 2007, the Hodgson farm lost next to no soil, and the water that ran off it into the Root was clear. Art and Jean Thicke have used EQIP funds on the incredibly steep land they dairy farm near La Crescent, and, as was featured in a previous blog, their land also weathered the floods quite well.

All-in-all, EQIP has turned out to be a good return on taxpayer investment in cases like this. Such public goods as cleaner water and reduced erosion can often be attained when you prime the ingenuity engine with a modest amount of cash. Such spending isn’t propping up an inefficient system that can’t survive on its own; it’s just giving creative stewardship a little boost.

The same can’t be said for the way the majority of EQIP’s money has been forked out lately.

The 2002 Farm Bill pretty much made EQIP a way to subsidize the building of some of he most environmentally-damaging systems known to rural America. Manure can be an important source of fertility, but to owners of large-scale industrial livestock operations, it’s just too much of a good thing, making it a waste product to be disposed of.

For years, boosters of CAFOs have been telling us that because of “superior efficiencies of scale” this type of food production deserves to succeed at the expense of family-sized farms. But for just as many years, these same people have been trying to figure out how to deal with the high cost of storing and disposing of millions of gallons of liquid manure—one of biggest Achilles heels of industrial livestock.

They have already externalized the costs of air pollution, water contamination and fish kills by forcing residents of rural townships and counties to deal with such side effects of “efficient” livestock production. But how to get the public to pay for putting in place the systems that cause these problems in the first place?

Congress to the rescue. In 2002, lawmakers in one fell swoop made it possible for large manure lagoons to be built with EQIP funds. These are expensive items, so of course, EQIP funding jumped to $6.1 billion over the next six years. The total cap on individual payments was raised nine-fold, to $450,000 over six years, and the annual cap was eliminated. It would be difficult to find a family-sized farm in America that could even begin to spend $450,000.

And here’s a nice little addition to the program that should make any penny-pinching accountant pass out: the government can no longer take cost of the contract into consideration when evaluating EQIP applications. All of a sudden, low-cost, efficient ways of reducing environmental degradation are no longer prioritized for funding. The more expensive, the better.

Hear that? It’s bloated corporate pigs squealing at the public trough.

The results have been predictable. A CFFE analysis of 2005 EQIP program data shows that 82 percent of EQIP funds went to cost-share projects, while only 18 percent were used for incentive payments to support practices such as grazing and nutrent/water management. Of all the cost-share payments, manure lagoons and other waste facilities hogged the biggest chunk.

For example, in Minnesota EQIP funding expanded from $7.9 million in 2002 to $26 million in 2007. Feedlot runoff control, waste storage facilities and manure transfer together garnered an average of 20 percent of all EQIP funds in the state between 2003 and 2007. On the other hand, in Minnesota prescribed rotational grazing received an average of 3.1 percent of funds during that same period. Wildlife habitat restoration and management fared even worse: .9 percent on average.

According to the CFFE report, between 2003 and 2007, on a national basis roughly 1,000 industrial hog and dairy operations pulled down at least $35 million annually in EQIP funding (in this case, “industrial operations” are defined as hog operations over 2,000 head and dairies over 500 head). Industrial hog operations make up less than 11 percent of all swine operations nationally, but received an estimated 37 percent of EQIP contracts in the hog sector. And industrial dairies make up only 3.9 percent of all milking operations, but raked in an estimated 54 percent of all EQIP dairy contracts.

“It is as if the bigger the pollution risk an applicant can create, the greater his chance of getting funded,” said southeast Minnesota dairy farmer Jon Peterson recently. That’s a dead-on analysis of exactly what’s going on.

I adhere to the old-fashioned philosophy that the more tax money the government spends on a certain group of businesses, institutions and individuals, the more information should be made available to the public about how that money is being used. Is it sparking innovation or serving as a crutch for a dinosaur of a technology? Congress doesn’t share that point of view. Get this: the 2002 Farm Bill prohibits the USDA from releasing certain information about contracts that producers receive through such initiatives as EQIP, even if a Freedom of Information Act (FOIA) request is filed.

According to the CFFE report, the USDA may be able to release information about individual payment amounts and the identity of the recipients. But apparently how the money was actually spent is confidential. Since when is how tax money is spent on liquid feces a case of national security?

Despite the TOP SECRET stamp put on EQIP spending, CFFE was able to dig up some information on where all this money is going for its report. And before the 2002 privacy provision went into effect, the Land Stewardship Project unearthed a specific list of EQIP payments made for manure systems in Minnesota in 2002 and 2003. Here are a few tidbits:

  • The average individual payment for animal waste systems in Minnesota was $47,202.
  • In Becker County, one producer received $285,500 to build a manure lagoon nearly 1 million cubic feet in size.
  • In Goodhue County, a producer received $138,802 to build a manure lagoon nearly 1 million cubic feet in size.
  • In Wabasha County, three producers received a combined total of $619,000 to build manure storage ponds and tanks totaling 1,120,000 cubic feet.

I’m beginning to see why the feds don’t want this information to be public.

Since 1996, the number of industrial hog and dairy operations in Minnesota has increased by 122 percent and 900 percent, respectively, according to the CFFE report. EQIP isn’t the only reason for this growth, but it sure hasn’t hurt.

This isn’t just about a direct subsidization of a type of agriculture that has been passed off as more “efficient” than sustainable, family-farm based food production. This is also about sending a certain message to farmers and the general public. Take note: the government prefers the industrial model, and so they’re going to use public funds to support it, even when it’s been proven to be a drag on societal good. This is similar to the message the Minnesota Department of Agriculture is sending farmers via its biased application process for the Livestock Investment Grants Program.

The good news is that the public has a chance to return EQIP to it’s honest origins. At the insistence of LSP and other member-organizations of the Campaign for Family Farms and the Environment, the 2008 Farm Bill lowered the amount of funding operations can receive through EQIP from $450,000 to $300,000 over the life of the Farm Bill (about five years). That’s still a ridiculous amount of money, but it’s a start.

USDA is expected to conduct a rulemaking process on EQIP by the end of the year. As a part of that process, the public can have a say on the future of EQIP via a comment period. In addition, a new President and Congress will be setting up shop in 2009. Putting pressure on them to make EQIP into a cost-effective program that serves the public, farmers and our landscape could pay off at a time when cutting budgets is receiving a lot of attention.

Check out LSP’s website for a list of what changes we and the other members of CFFE are calling for. You can also contact LSP Policy organizer Adam Warthesen at adamw@landstewardshipproject.org or 612-722-6377 for more information on how to get the message across to Washington that EQIP is in need of major reform.

It’s time to wean industrial ag from the public teat and see how “efficient” it really is.

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