First authorized in the 1996 Farm Bill, the Environmental Quality Incentives Program (“EQIP”) is a voluntary conservation program that offers financial and technical support to producers who implement conservation practices on working agricultural lands. EQIP is administered by the United States Department of Agriculture’s (“USDA”) Natural Resource Conservation Service (“NRCS”) which works with program participants to establish practices that support natural resources while keeping land in agricultural production.
The overall purpose of EQIP is to “promote agricultural production, forest management, and environmental quality as compatible goals, and to optimize environmental benefits.” 7 C.F.R. § 1466.1(a)(1). To accomplish this purpose, EQIP encourages farmers and ranchers to implement conservation practices on working lands in exchange for payment and technical assistance.
Like other conservation programs, the way EQIP functions is relatively simple. Interested agricultural producers work with an NRCS agent to help them develop an EQIP application to submit for approval. NRCS then ranks and accepts the applications according to criteria determined by the Service. Once an application is accepted, NRCS and the agricultural producer enter into a formal contract that specifies all of the conservation practices that will be implemented, and the payments that NRCS will make to the producer. 7 C.F.R. § 1466.21(b)(1). These contracts can last for up to ten years, and payments will typically be limited. For example, EQIP contracts formed from 2018 to 2023 are capped at $450,000. 7 C.F.R. §§ 1466.21(b)(2), (d).
There is a broad selection of conservation activities that can be implemented through EQIP. These activities can include various vegetative and land management practices, such as improving irrigation efficiency, improving soil health, and restoring pasture land or wildlife habitat. During the application process, applicants will work with NRCS agents to determine which conservation practices will be the most appropriate for their operation.
While any of the approved conservation practices found in the NRCS Field Office Technical Guide are eligible for EQIP, NRCS is likely to determine which EQIP applications are accepted based on whether the proposed conservation activities will help to further its “national priorities.” Under EQIP, NRCS is required to work with other federal agencies and state and local governments to identify issues that are used to “determine the distribution of EQIP funds and guide local EQIP implementation.” 7 C.F.R. § 1466.3. These issues are known as national priorities. The current national priorities include:
- Reductions of nonpoint source water pollution, such as nutrient, sediment, or pesticide runoff;
- Reductions of ground and surface water contamination;
- Reductions of pollution from concentrated animal feeding operations and other agricultural sources;
- Conservation of ground and surface water resources
- Reductions of air pollutants
- Improvement of wildlife habitat, particularly for species that are listed under the Endangered Species Act; and
- Energy conservation.
7 C.F.R. § 1466.4. EQIP applications that target these priorities may be more likely to get accepted.
EQIP participants can receive payments to help with both the cost of implementing conservation practices, as well as any income forgone as a result of implementation. While the amount of payment a producer receives will differ from contract to contract, payment may not exceed 75% of the estimated costs incurred from carrying out the conservation practice, or 100% of the estimated income forgone. 7 C.F.R. § 1466.23(b)(1). Socially disadvantaged, limited resource, beginning, and veteran farmers or ranchers may receive payment of up to 90% of the costs associated with implementing the conservation practices. 7 C.F.R. 1466.23(b)(3). Additionally, when NRCS is determining the amount of estimated income forgone it may assign higher significance to conservation practices which impact soil health, water quality, nutrient management, pest management, air quality, wildlife habitat, invasive species management, or other important natural resource concerns identified by NRCS. 7 C.F.R. § 1466.23(b)(2).
Every finalized EQIP contract is required to fully describe both the conservation practices that the producer will adopt, and the payments they will receive from NRCS. 7 C.F.R. § 1466.21(b)(1). The portion of the contract that describes the conservation practices is referred to as the “EQIP plan of operations.” The plan of operations must include details such as the participant’s specific conservation objectives, the timeline for carrying out the practices, and information that allows the effectiveness of the conservation practices to be evaluated. 7 C.F.R. § 1466.7. Every EQIP contract must contain a plan of operations. EQIP contracts will also typically contain a provision requiring that the producer will not do anything on the land covered by the EQIP contract that would defeat the purpose of the program. 7 C.F.R. § 1466.21(b)(3). Additionally, if NRCS finds that a producer is failing to appropriately maintain the conservation practices described in the EQIP contract, it may terminate the contract and request a refund of the completed payments. 7 C.F.R. § 1466.22(e).
Contract Eligibility & Ranking System
To apply for EQIP, an interested producer must first contact their local NRCS office and work with an agent to determine whether they satisfy the eligibility requirements. Both the applicant, and the land they wish to enroll in EQIP must be eligible in order to qualify for the program.
An applicant will be eligible for EQIP if they are the owner or operator of land that is used for agriculture, livestock, or forestry production. 7 C.F.R. § 1466.6 (b)(1) If the applicant is a tenant who is in control of an agricultural operation, NRCS may require the applicant to obtain written agreement from the landowner before applying for EQIP. 7 C.F.R. § 1466.6(b)(3)(ii). The eligibility requirements for land to be enrolled in EQIP are even more straightforward. The land must be either privately owned, or it must be publicly owned land that either a working part of the applicant’s agricultural operation or that the applicant has control over. 7 C.F.R. § 1466.6(c). If both the applicant and the land are eligible, the applicant can continue to work with the NRCS agent to develop their EQIP plan of operations and submit their application for ranking.
EQIP Ranking System
Applications for EQIP may be submitted at any time, and are accepted on a continuous basis throughout the year. NRCS is required to evaluate and rank each application in order to determine which to accept. Applications within each state are grouped with similar crop, forestry, and livestock operations and evaluated within each group. Ranking criteria typically vary from state to state, but in general NRCS will rank applications based on:
- Overall cost-effectiveness of the proposed conservation practices;
- The magnitude of expected conservation benefits;
- How effectively the project addresses local natural resource concerns;
- The applicant’s ability to complete the conservation practices in a timely manner; and
- Whether existing conservation practices or systems in place at the time the application is accepted will be improved.
7 C.F.R. § 1466.20. Along with the general ranking criteria, NRCS may also give priority to applications that include either water conservation or irrigation-related practices that reduce water use. 7 C.F.R. § 1466.20(b)(3). The highest ranked applications are the most likely to be accepted.
The Inflation Reduction Act (“IRA”) recently passed by Congress contains several provisions involving various conservation programs, including EQIP. Specifically, the IRA sets aside $8.45 billion to extend EQIP funding through 2026. Additionally, the IRA states that EQIP applications which contain conservation practices that would either limit methane emissions from cattle, or reduce soil carbon losses should be prioritized to receive funding. H.R. 5376, 117th Cong. § 21001(a)(1)(B). Going forward, it would appear that NRCS will be required to take both of those priorities into account when ranking EQIP applications. To learn more about conservation provisions in the IRA, click here.
To read the section of the Farm Bill authorizing EQIP, click here.
To read the regulations implementing EQIP, click here.
For more information from NRCS on EQIP, click here.
For more National Agricultural Law Center resources on conservation programs, click here.