Signups down, BWSR seeks to tweak CREP

By Joe Albert Staff Writer

St. Paul — One year after signup for the second round of the
Conservation Reserve Enhancement Program began, just more than 1
percent of the acreage goal has been enrolled.

The goal for CREP II is 120,000 acres by the end of next year
(the program conceivably could be extended).

To date, about 1,650 acres have been enrolled and about the same
amount are pending, said Kevin Lines, who oversees the conservation
easement program for the Board of Water and Soil Resources.

The problem: rapidly rising land prices and CREP payments that
aren’t keeping up. Later this week, Lines was to present to the
BWSR board a request for the state to increase its payment
rate.

“We have to give (landowners) something to seriously think
about,” Lines said. “If we don’t do something, we are not going to
enroll land.”

While the first CREP, which covered 100,000 acres in the
Minnesota River watershed, was wildly successful, things have
changed since then.

Landowners have additional options for programs in which to
enroll their land, and the price of farmland in most areas of the
state has roughly doubled in recent years. The payments they would
receive by enrolling in CREP II no longer are attractive, Lines
said.

“It’s crazy, but to deal with it we have to be competitive,” he
said. “You’re trying to encourage landowners to do something
different than they are doing right now.”

Initially, the plan for CREP II was to protect 120,000 acres in
three parts of the state with $50 million in state money matched by
$200 million in federal money. BWSR received $20 million last year
in bonding dollars, and was to seek the remaining $30 million
during the recently completed session.

But only $1 million of last year’s money had been spent, and
lawmakers, concerned by the pace of enrollment in the program,
didn’t give BWSR any more money. Instead, they left open the
possibility of a limited bonding bill next year (a non-bonding
year, traditionally).

“It was pretty apparent right off the bat that we were not
getting the interest we would like,” Lines said. “Landowners were
coming in and checking out the program. Frankly, we are just not
offering a competitive enough payment rate.”

Landowners who sign up for CREP II have to do two things: sign a
14- or 15-year contract for the Conservation Reserve Program, and
sign a 45-year or permanent easement, depending on the land
type.

Landowners receive an annual CRP payment, and a lump sum RIM
Reserve payment from the state for the easement.

The people in the field trying to sell CREP II to landowners are
saying the state needs to about double the RIM payment, Lines
said.

Lines believes between the state and the federal parts of the
program, landowners need to receive about 90 percent of the
estimated market value of their land. So far, the U.S. Department
of Agriculture hasn’t expressed an interest in raising the CRP
payment rates, Lines said.

“If we can’t get a payment rate increase, it’s not going
anywhere,” he said.

Originally, every state dollar invested in CREP II was to be
matched by $4 in federal money. Under Lines’ proposal to the BWSR
board, the state would get about $2 for every dollar it invests in
the program.

Additionally, because land values have risen so fast, the
estimated market values used to determine payments often don’t
reflect the true value of land.

“We need to establish a system that recognizes what’s occurring
on the landscape,” Lines said.

If the state does increase its payment rate – and, assuming BWSR
receives another $30 million for the program, to bring the total
state contribution to $50 million – it would be able to enroll
fewer acres than originally planned.

The 120,000-acre goal still could be achieved by seeking
additional bonding money, Lines said.

“I’m disappointed that enrollment hasn’t been where we would
like it to be,” he said. “But I’m still extremely optimistic we can
make changes to the program that will make it successful and still
make it a good buy for state dollars.”

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