Incentive Programs for the Implementation of Agricultural BMPs

Curriculum Source:

VA Agricultural BMP Manual

Objectives

• Define BMP.• List and explain the incentive programs

that are available through the Soil and Water Conservation District to assist with the implementation of agricultural best management practices (BMPs).

Incentive Programs

• VA Agricultural Best Management Practices (BMP) Cost-Share Program

• Conservation Reserve Enhancement Program (CREP)

• VA Agricultural BMP Tax Credit Program

• VA Agricultural BMP Loan Program

• Small Business Environmental Compliance Assistance Fund

VA AG BMP Cost-Share

• Administered by DCR thru local SWCDs.• SWCDs recruit participants.• > 30 Eligible BMPs.• Cost-Share

– Flat Rate– Percentage– Combination

• Cost-Share Caps– State Cap = $50,000– District Cap

BMP Cost-Share (Cont.)

• BMPs must be part of a NRCS Conservation Plan.

• Cost-Share is approved by the local SWCD based on set criteria that improve water quality.

• Cost-Share Payments are disbursed when a BMP is complete and certified.

• Reference: Current PY VA AG BMP Manual

CREP• CREP = Conservation Reserve Enhancement Program• Combination of Federal and State Funds.• Enhanced version of the Federal CRP (Conservation

Reserve Program).• Two Geographical Components

– Chesapeake Bay– Southern Rivers

• Basic Elements – Livestock Exclusion– Riparian Buffer– Wetland Restoration

• FSA approves contract.• SWCD makes state portion of payment.

BMP Tax Credit

• Applicable to any individual or corporation engaged in agricultural production for market.

• Administered by local SWCDs.• > 40 BMPs eligible for Tax Credit.• Must have an approved Conservation

Plan.• Granted after the BMP is completed

and certified. – Tax Credit Certification Letter is issued.

BMP Tax Credit (Cont.)

• Equal to 25% of the cooperator’s approved (out-of-pocket) expenses, not to exceed $17,500 in any taxable year.

• Must be applied in the tax year the BMP is completed.

• Can be carried over for up to 5 yrs.

Equipment Tax Credit

• Credit for the purchase of conservation tillage equipment and advanced technology application equipment.

• Must have a Nutrient Management Plan approved by the local SWCD for advanced technology application equipment.

Equipment Tax Credit (Cont.)

• Can be up to 25% of the purchase not to exceed:– $4,000 for conservation tillage equipment– $3,750 for advanced technology application

equipment

• Must be applied in the tax year the equipment is purchased.

• Can be carried over for up to 5 years.

Agricultural BMP Loan Program

• Administered by the Department of Environmental Quality (DEQ).

• Applicable to any VA producer wishing to implement eligible BMPs in order to reduce the effect of polluted runoff entering VA waters.

• > 20 BMPs are eligible for the loan program.

Agricultural BMP Loan Program (Cont.)

• Approved Conservation Plan.

• Interest Rate

• Minimum Loan Amount = $5,000

• Loan Repayment Period = BMP lifespan

• Individual loans will be administered by certain participating lending institutions.

VA Small Business Environmental Compliance Assistance Fund

• Administered cooperatively by DEQ and the Department of Business Assistance (DBA).

• Individual loans will be administered by DBA.

• Applicable to any small business operating in VA.

• >15 BMPs are eligible for the loan program.

VA Small Business Environmental Compliance Assistance Fund

• Agricultural BMPs require approved Conservation Plan.

• Maximum Loan = $100,000.

• Interest Rate is 3%.

• Loan repayment period – BMP lifespan.

• BMPs needed as part of an issued enforcement action are not eligible for loan funds.

Program Contacts

• BMP Cost-Share Programs & Tax Credit– Local SWCD– DCR Watershed Conservation District Coordinator

(CDC)• CREP

– DCR Richmond Office, CREP Program Manager• Equipment Tax Credit

– DCR Watershed CDC or Ag. Incentives Program Manager

• Agricultural BMP Loan Program– VA DEQ Construction Assistance Division

• Small Business Environmental Compliance Assistance Fund– VA DEQ Small Business Assistance Program Manager