To help guide the allocation of funding in conservation programs, USDA agencies that administer these programs identify national funding priorities for their programs. For instance, EQIP has a set of national environmental priorities that include:(3)

? Reducing soil erosion, nutrient runoff, pesticide losses, or excess salinity;
? Improving water conservation;
? Improving air quality (i.e., reducing particulate matter, nitrous oxides, volatile organic compounds and ozone precursors and depleters); and
? Increasing wildlife habitat.

Using the national priorities as guidelines, each state develops ranking systems to allocate the EQIP funds at the local level. As a result, EQIP ranking systems are highly variable between, and sometimes within, the states.(4) The State Conservationist is ultimately responsible for the allocation of funds at the state level, but, depending on the State, it may be the District Conservationists that evaluate EQIP applications and make funding recommendations at the county level.(5) Successful applicants sign a contract that outlines the BMP details, and payments are made once NRCS has determined that the requirements for BMP installation or implementation have been met.

The EQIP Final Rule, which contains the implementation language for the program, lists the factors that the State Conservationist is required to consider in their allocation of funds. One of these factors is the degree of cost-effectiveness of the proposed BMP. Very few states, however, have incorporated cost-effectiveness criteria into their ranking systems.

Some state EQIP ranking systems are loosely based on the principle of paying for performance. An application is awarded points based on how well they are expected to address the environmental priorities and then ranked according to total points. Funding is supposed to be prioritized to those applications that are awarded the highest number of points and therefore have the largest expected environmental outcomes. However, the extent to which this occurs also appears to be highly variable.

Points are also typically awarded on a qualitative basis, rather than a quantitative basis, and are often related to whether various criteria are simply being met. For example, in Iowa points are awarded for criteria such as agreeing to have a farm nutrient management plan, and in Pennsylvania, points are awarded when a farmer plans to implement a pest management plan or establish a 35-foot riparian forest buffer along river headwaters.

Notes

2. EQIP Final Rule: http://www.nrcs.usda.gov/programs/farmbill/2002/rules/eqip030530.html

3. EQIP national priorities: http://www.nrcs.usda.gov/programs/eqip/

4. For more information on state EQIP ranking systems visit: http://www.nrcs.usda.gov/programs/eqip/EQIP_signup/2006_EQIP_Signup/
index.html

5. For more information on how EQIP is implemented visit: http://www.nrcs.usda.gov/programs/farmbill/2002/pdf/EQIPPrDs.pdf