RD292 - Annual Funding Needs for Effective Implementation of Agricultural Best Management Practices (BMPs) - October 2009


Executive Summary:
In 2008 the Virginia Natural Resources Commitment Fund (VNRCF) was established in Virginia Code as a subfund of the Virginia Water Quality Improvement Fund. Monies placed within the VNRCF are to be used solely for the Virginia Agricultural Best Management Practices Cost-Share Program. The Department of Conservation and Recreation (DCR) is directed by § 10.1-546.1 to submit annually by October 15th, the “...funding amount for effective Soil and Water Conservation District technical assistance and implementation of agricultural best management practices…for each year of the ensuing biennial period.”

DCR examined the agricultural BMP funding needs that pertain to achieving water quality objectives in the Chesapeake Bay basin, as well as the agricultural BMP needs for “TMDL” (Total Maximum Daily Load) waters that fail to achieve state water quality standards for the Southern Rivers portion of the state (waters outside the Bay basin). DCR recognizes the need to address all water quality problems that are associated with agricultural nonpoint source pollution; however the Environmental Protection Agency’s (EPA) development of a Chesapeake Bay TMDL is expected to impose undesirable consequences for jurisdictions (6 states and the District of Columbia) that fall short of Chesapeake Bay nutrient and sediment reduction targets.

To address the agricultural BMP needs within the Chesapeake Bay, DCR used the most current (2005) Tributary Strategy reduction goals which were established through use of the EPA Chesapeake Bay Program Office’s phase 4.3 watershed model. DCR has focused on the implementation of the five priority practices (nutrient management plans, cover crops, livestock exclusion from waterways, conservation tillage including continuous no-till and establishment of riparian buffers) over a 15 year period that begins in fiscal year 2011 and ends in 2025 –the agreed to deadline by EPA and Bay jurisdictions to have in place the strategies that will achieve the Bay’s water quality objectives.

Funds placed within the VNRCF must be divided with 55% supporting BMPs in the Chesapeake Bay, 37% for BMPs in the Southern Rivers and 8% for provision of technical assistance by Soil and Water Conservation Districts (SWCD). By using the annual funding projections for BMPs in the Chesapeake Bay, DCR represented the amounts as 55% of the total annual deposit in the VNRCF. By mathematically deriving the total deposit amount, the remaining 45% was apportioned with 37% of deposited funds supporting BMPs in the Southern Rivers and 8% supporting SWCD technical assistance. Statewide funding needs are summarized on page 9 of this report and total approximately $1.1 billion between FY11 and FY25.

In addition, the Chesapeake Bay states, including Virginia, have committed to meeting two-year “milestones” in order to accelerate restoration and provide greater accountability. An additional appropriation in the Chesapeake Bay watershed for FY11 would be necessary to meet this commitment.

It is important to recognize that projections of needed BMPs and their associated costs are dynamic and will change over time. Funding levels in the near term will ultimately affect needs to later years. It is also important to recognize that current difficult economic conditions may hamper the ability of the Commonwealth to meet the total needs. Further, acreage in agricultural production varies from year to year (some acres are lost to other land uses, some acreage is gained when idle land is cropped). Projections of needed BMPs changes when implementation of cost-shared practices is credited, and when better accounting for voluntary BMPs is documented. Water quality models such as the EPA Chesapeake Bay watershed model continue to evolve and refine projections of BMP efficiencies. A new phase 5 model that will be released in coming months is expected to generally reduce the projected water quality benefits of agricultural BMPs. Cost-share funding amounts change over time to elicit farmer participation in voluntary state and federal cost-share programs. These factors and others mean that the projections of funding for agricultural BMPs should be examined over time and as directed by § 10.1-546.1, DCR shall report annually by October 15th, the funding amount needed for implementation of agricultural BMPs.