Senate reconciliation keeps farms, forests in climate formula

Budget bill includes more than $20 billion for programs including conservation, biofuels and wildfire prevention

Jim Diamond, left, and his wife Sally Jones-Diamond check the wheat during the harvest season at a farm in Akron, Colo., on July 15.  (Hyoung Chang/The Denver Post via Getty Images)
Jim Diamond, left, and his wife Sally Jones-Diamond check the wheat during the harvest season at a farm in Akron, Colo., on July 15. (Hyoung Chang/The Denver Post via Getty Images)
Posted August 2, 2022 at 1:47pm

The Senate's revived reconciliation deal would keep agricultural conservation, forestry and renewable fuels in the Democrats’ formula for fighting climate change.

The overall budget package, which is billed as an inflation fighter, booster of energy production and a down payment to fund climate-smart policies, could face a test as soon as Wednesday with a vote on a motion to proceed. If the motion is agreed to, a series of votes on amendments would follow Thursday.

The measure proposes funding of more than $20 billion for agriculture provisions. The legislation unveiled last week includes familiar elements of the 2021 budget reconciliation proposal.

For example, key voluntary conservation programs operated by the Agriculture Department would receive additional money for projects and practices to improve soil carbon, reduce nitrogen losses or sequester greenhouse gas emissions.

The Environmental Quality Incentives Program, which works with farmers and ranchers on projects to improve water and soil quality, would receive an authorization of $8.45 billion. The legislation would provide a total of $3.25 billion through fiscal 2026 for the Conservation Stewardship Program that focuses conservation practices on lands kept active in  agricultural production.

The Agricultural Conservation Easement Program would receive a total of $1.4 billion through fiscal 2026  for limiting nonagricultural uses such as development on protected agricultural land and preserving wetlands and grasslands. The bill also would provide $6.75 billion through fiscal 2026 for the Regional Conservation Partnership Program, which works with private landholders on local conservation projects.

The new bill includes the same directive to the regional conservation partnership program included in a November 2021 reconciliation package. The program is to prioritize funding arrangements that “support the implementation of projects that assist agricultural producers and nonindustrial private forestland owners in directly reducing soil or nutrient losses or greenhouse gas emissions, or capturing on sequestering greenhouse gas emissions associated with agricultural production.”

In the latest proposal, $1 billion would be authorized for technical assistance to property owners through the Natural Resources Conservation Service. The money would remain available until fiscal 2031. The agency also would get an additional $300 million to last through fiscal 2031 for work to quantify carbon sequestration and greenhouse gas emissions.

The National Association of Conservation Districts said the potential investments in agriculture conservation programs is needed.

“USDA conservation programs are oversubscribed, and this funding would go a long way in helping more producers across our country implement conservation practices to improve their operations and make their lands more resilient to the changing climate,” Michael Crowder, association president, said in a statement.

Crowder also said his members are likely partners with the Natural Resources Conservation Service in assessing needs, developing plans and turning those plans into effective conservation practices. 

Senate Agriculture Chairwoman Debbie Stabenow, who pushed hard for increased conservation funding during the 2021 reconciliation process, cheered the text of the new bill.

“We are equipping farmers, foresters, and rural communities with the necessary tools and resources to be a part of the solution and grow their local economies at the same time.” Stabenow said in a statement.

Giana Amador, co-founder and policy director of the nonprofit Carbon 180, said the Senate bill would “go a really long way in particular around expanding some work that is specifically focused on conservation and moving it much closer to climate. So we not only see plus-ups for the core conservation programs, but we see a prioritization of what USDA has been calling climate-smart practices or practices that can help reduce emissions and also store carbon in our soils.”

Amador, whose organization focuses on removing carbon emissions from the atmosphere, said the bill’s conservation priorities would enable the Agriculture Department to advance work to understand how carbon sequestration works in different types of soils and how regional practices should be tailored for the most effective results. 

“What works on a ranch in Colorado is not the same as the thing that is going to work on an almond orchard in California,” she said.     

Forestry provisions, biofuels

The National Forest Service, a part of the Agriculture Department, also would have a role to play. 

The bill would authorize $1.8 billion for the Forest Service to remove ailing or dead trees, dense growth and other hazardous fuels areas on federal land that can feed wildfires in overlapping areas of national forestlands and populated areas. These areas are known as the wildland-urban interface. Wildfires not only pose a threat to lives and property, they also release large amounts of carbon dioxide and other greenhouse gases that can worsen climate change.  

Tree planting would get a $1.5 billion boost in grant money to state agencies, tribal governments, nonprofit organizations and local governments with a priority for projects that increase the number of trees and expand tree canopy in underserved communities. The Forest Service also would receive $200 million for projects on national forestlands to manage vegetation that helps retain water and reduce soil runoff into water sources or watersheds that  serve millions of people.  

To help underserved forestland owners navigate emerging and complex private markets for climate and forest resilience markets, the legislation would authorize $150 million in competitive grants for private and forestland owners and $100 million in competitive grants for private forestland owners with 2,500 or fewer acres.  

The Forest Legacy Program would get an infusion of $700 million for the work the Forest Service does in partnership with states to keep private forestland. The money would be distributed through competitive grants with a priority for purchasing land or interests in land that offers significant potential carbon sequestration or benefits to low-income, underserved communities. 

Altogether, the bill proposes $5 billion in funding for work in public and private forestlands.

To aid rural electric cooperatives in reducing greenhouse gas emissions, the bill would authorize $9.7 billion in fiscal 2022 to help with the costs of transitioning energy sources to climate-friendly operations such as zero-emission systems or carbon capture systems. The money would be available as grant money through Sept. 30, 2031.

Biofuels also would get a boost with $500 million funding to increase their sale and use with grants to cover up to 75 percent of total costs of equipment to distribute or store blends of transportation fuels, such as ethanol, made from agricultural commodities.

The renewable fuels industry also would be aided by proposed tax credits to promote the use of sustainable aviation fuels, carbon capture, advanced biofuels and biodiesel and renewable diesel fuels.

Emily Skor, CEO of Growth Energy, a biofuels trade group, said the provisions would help expand the role of biofuels in transportation as low-carbon alternatives. “We look forward to continuing our work with champions in the House and Senate to ensure our priorities are reflected in any final package," she said in a statement.

Rep. Randy Feenstra, R-Iowa, is one of those champions, touting Iowa’s corn-based ethanol. Feenstra welcomed the biofuels provisions, but not the business tax increases proposed in the overall bill.

“It’s sort of a Catch-22. There are some very important pieces of legislation in that package, however, it also would hit biofuels. On one side of the ledger they are trying to help biofuels, but on the other side of the ledger, it’s pretty punitive for biofuels,” Feenstra said.

Feenstra said the reconciliation process by its nature means support for the budget bill will fall along party lines.

“There’s no Republican who is going to vote for it, surely not me,” he said. 

However, he said there is bipartisan support for biofuels. He cited a legislative package the House passed in June that contains two biofuels bills.

The package includes elements of legislation by Rep. Cindy Axne, D-Iowa, and a bill by Rep. Angie Craig, D-Minn. The Axne bill would authorize $200 million in fiscal 2022 and 2023 funding for competitive USDA grants to fuel retailers to offset costs of installing blender pumps that can dispense fuel mixtures with more than 10 percent ethanol or 20 percent biodiesel. The goal is to increase the availability of such fuels and support increased biofuel production and use. 

Craig’s legislation would make permanent the Biden administration waiver announced in April to allow summer sales of a gasoline blend of 15 percent ethanol and 85 percent gasoline. 

“This is something we can collaboratively do whether it be this Congress or the next Congress,” Feenstra said. ”In the next Congress, if I’m in the majority I will be pushing that agenda very hard to make sure that we do do something for biofuels and get it on a level playing field with the rest of the energy components that are out there,” Feenstra said.