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CRP RULE CHANGE: A new early termination option for certain Conservation Reserve Program contracts offers incentives for landowners who transfer farmland to beginning farmers. USDA is offering this option as a way to help new and beginning farmers gain access to land.

CRP contracts can be terminated early to transfer land

Farm Program FAQs: USDA allows for transfer of certain Conservation Reserve Program land to new farmers and livestock producers.

In this month’s column, John Whitaker, who has served as state executive director of the Farm Service Agency in Iowa for over seven years, discusses FSA’s efforts to expand access to land for new farmers and livestock producers. “One of the major challenges new producers face is the access to land,” says Whitaker.  “Through adjustments to our Conservation Reserve Program provisions, we are easing the way for landowners who participate in CRP to transfer property to the new farmers or livestock producers.”

What is the Conservation Reserve Program?
In exchange for a yearly rental payment, farmers enrolled in CRP agree to remove environmentally sensitive land from agricultural production and plant species that will improve environmental health and quality. Contracts for land enrolled in CRP are 10 to 15 years in length. The long-term goal of the program is to re-establish valuable land cover to help improve water quality, prevent soil erosion and reduce loss of wildlife habitat.

What is the motivation behind offering CRP land transfer options to new and beginning agricultural producers?
This change to the CRP program is just one of many that USDA has implemented based on recommendations from the Land Tenure advisory subcommittee. The subcommittee was asked to identify ways USDA could use or modify its programs, regulations and practices to address the challenges of beginning farmers and ranchers in their access to land, capital and technical assistance. With CRP enrollment close to the congressionally mandated cap of 24 million acres, the early termination option allows USDA to enroll other land with higher conservation value elsewhere.

Are all CRP acres eligible for transfer?
On Jan. 9, USDA began offering the opportunity for certain CRP contract holders to “opt out” early in order to transfer land. However, not all CRP ground is eligible. The land that is eligible for the early termination is among the least environmentally sensitive land enrolled in CRP. Eligible CRP acres include land that is enrolled under the following CRP practices:
• CP1, establishment of permanent introduced grasses and legumes
• CP2, establishment of permanent native grasses
• CP3, tree planting
• CP 10, grasses already established
• CP 11, trees already established 

Is there a penalty to CRP contract holders for opting out early and transferring land?
Normally, if landowners terminate a CRP contract early, they are required to repay all previous payments, plus interest. The new policy waives this repayment if the land is transferred to a new farmer or livestock producer through a sale or lease with an option to buy. 

Are there CRP or similar program options for new producers who receive transferred or terminated CRP acres from current CRP contract holders?
Yes, acres terminated early from CRP under these land tenure provisions will be eligible for priority enrollment consideration into the CRP Grasslands if eligible, the Conservation Stewardship Program, or the Environmental Quality Incentives Program, as determined by the Natural Resources Conservation Service.

How can I learn more about CRP termination or transfer options and related programs?
For more information about CRP and to find out if your acreage is eligible for early contract termination, contact your local FSA office or go online to fsa.usda.gov/crp. To locate your local FSA office, visit offices.usda.gov.

 

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