Building Blocks: Basics of the Agricultural Conservation Easement Program
Under the Agricultural Conservation Easement Program (“ACEP”), private landowners, land trusts, and other entities work with the United State Department of Agriculture’s Natural Resource Conservation Service (“NRCS”) to both preserve working farms, and protect wetlands and grasslands through the use of long-term easements. Created in 2014, the ACEP is meant to help landowners permanently protect vital lands from development.
The ACEP was first introduced in the 2014 Farm Bill as a consolidation of three previously separate easement programs – the Wetlands Reserve Program, Grassland Reserve Program, and Farm and Ranch Land Protection Program. The program is divided into two basic tracks, the Wetland Reserve Easement (“WRE”) and the Agricultural Land Easement (“ALE”). The wetland land easement track is largely similar to the old Wetlands Reserve Program, while the agricultural land easement track incorporates the other two former easement programs. ACEP participants receive financial and technical assistance in exchange for enrolling their lands in one of the two tracks.
As easement is a non-possessory interest in property that the landowner voluntarily grants to the easement holder, giving them permission to use the property in some way. For example, a landowner who owns a riverfront property, could grant his neighbor an easement to walk through his backyard to access the river. In that scenario, the neighbor would not become the owner of the landowner’s backyard, but would have the right to use the yard at any time in order to access the river. Easements are extremely flexible. They can be used to grant a wide variety of property uses, and can last for as little as a few weeks to as long as decades or even into perpetuity. Under the ACEP, landowners voluntarily grant easements to NRCS that allows the Service to implement conservation practices, and prevent the land from being altered or developed for as long as the easement lasts.
Wetland Reserve Easement
One of the main purposes of the ACEP is to “restore, protect, and enhance wetlands[.]” 16 U.S.C. § 3865(b)(2). To accomplish this goal, the WRE allows landowners and NRCS to work together on restoring wetland functions and values by entering previously farmed wetlands into easements.
In general, WRE easements will be either permanent, or last for a period of 30 years. 7 C.F.R. § 1468.30(a)(5). When a landowner enters land into a permanent easement through the WRE, they agree that they and their heirs will cooperate in the “restoration, protection, enhancement, maintenance, management, and monitoring of the land” according to the terms of the easement agreement and the wetland reserve plan of operations (“WRPO”). 7 C.F.R. § 1468.37(a)(2). Each WRPO is a document developed and approved by NRCS that describes the conservation measures that will be implemented during the easement in order to restore and manage the affected wetlands. On lands that have been enrolled into a permanent easement, NRCS will pay the landowner 75% – 100% of the costs associated with implementing the WRPO. 7 C.F.R. § 1468.36(a). Additionally, landowners that enter into a permanent easement agree to grant NRCS the right of legal access to the easement area, the right to authorize appropriate conservation uses of the easement area, and the right to manage and monitor activities in the easement area. 7 C.F.R. § 1468.37(a)(2). In exchange, the landowner will receive monetary compensation equal to either the fair market value of the land according to the Uniform Standards for Professional Appraisal Practices, the geographic area rate cap, or a written offer made by the landowner applying for WRE. 7 C.F.R. § 1468.34(a)(3).
When a landowner enters into a 30-year easement, they agree that for the duration of the easement, the land will be managed according to the WRPO. 7 C.F.R § 1468.37(b)(2). Additionally, the landowner agrees that while the easement is in place, NRCS will have a legal right to access the easement area, the right to authorize appropriate conservation activities, and the right to monitor and manage activities on the enrolled area. 7 C.F.R. § 1468.37(2). In exchange, NRCS will pay the landowner no more than 75% of what would have been paid for a permanent easement, and 50% – 75% of the costs associated with implementing the WRO. 7 C.F.R. §§ 1468.34(a)(2), 1468.36(a).
Agricultural Land Easement
The purpose of the ALE component of the ACEP is to “protect the agricultural use and future viability” of farmland by “limited nonagricultural uses of that land[.]” 16 U.S.C. § 3865(b)(3). Under the ALE, NRCS partners with eligible entities such as states, local governments, or nongovernmental organizations such as land trusts to purchase easements on agricultural land in order to prevent the land from being further developed.
In general, easements created under the ALE last either into perpetuity, or for the maximum duration allowed by state law. When an easement is created under the ALE, NRCS and the eligible entity enter into an ALE-agreement which lays out all the terms and conditions of the easement. 7 C.F.R. § 1468.23(a). Typically, the ALE-agreement will address the specific interests in land that the easement grants to NRCS, the responsibilities of NRCS, the responsibilities of the eligible entity, whether a conservation plan will be developed, and any other requirements NRCS deems necessary. 7 C.F.R. § 1468.23(a). Unlike easements under the WRE which always require a plan of operations, easements under ALE are only required to have a conservation plan for land that is designated by NRCS as highly erodible cropland.
When entering into an easement, NRCS will provide the eligible entity up to 50% of the fair market value of the enrolled land. The eligible entity is responsible for determining the fair market value using either the Uniform Standards of Professional Appraisal Practices, the Uniform Appraisal Standards for Federal Land Acquisitions, an areawide market analysis survey, or any other method approved by NRCS. 7 C.F.R. § 1468.24(a)(1). NRCS must approve the determination of the fair market value before the eligible entity may make any payments of easement compensation to the landowner. 7 C.F.R. § 1468.24(a)(8).
Program Eligibility & Ranking Criteria
Because funding for easements under the WRE goes directly to landowners, while funding for easements under the ALE goes to entities that purchase easements, the eligibility requirements for each track are slightly different.
To qualify for an easement under the WRE, both the landowner and the land must be eligible. A landowner will be eligible for the WRE track of the ACEP if they have been the legal owner of the land for which the easement is being sought for at least two years prior to applying to the WRE. 7 C.F.R. § 1468.30(c). For land to be eligible for an easement under the WRE, NRCS must determine that the land meets at least one of the following designations:
- Farmed wetlands or converted wetlands together with adjacent lands that are dependent on the wetland functions;
- Agricultural lands that were altered by flooding so as to develop and retain wetland values and functions;
- Former or degraded wetlands;
- Wetlands that are currently enrolled in the Conservation Reserve Program;
- Riparian areas that, if restored, would link together protected wetlands; or
- Cropland or grassland that was used for agricultural production prior to flooding.
7 C.F.R. § 1468.30(e).
To qualify for an easement under the ALE, both the land and the entity applying for easement funding must be eligible. An entity will be eligible if they are committed to the long-term preservation of agricultural lands, are capable of managing and enforcing easements, have the sufficient number of staff dedicated to easement stewardship, and have enough funding to supply at least 50% of the purchase cost of the easement. 7 C.F.R. § 1468.20(b). Additionally, land will be eligible for an easement under the ALE if it meets the following criteria:
- Is subject to a written pending offer by an eligible entity to enter into an easement;
- Contains at least 50% prime or unique farmland that is used for the production of specific food and fiber crops, contains historical or archaeological resources, protects grazing uses, or further a state or local policy that is consistent with the goals of the ALE; and
- Is cropland, rangeland, grassland, pastureland, nonindustrial private forestland, or located in an area that has historically been dominated by grassland.
7 C.F.R. § 1468.20(d).
Finally, both the WRE and ALE are highly competitive. Applications for both tracks are ranked against one another according to criteria determined by NRCS, and applications that receive a higher ranking are more likely to be chosen. Applications for the WRE are ranked based on criteria such as the overall conservation benefits of obtaining the easement, including possible habitat restoration and the proximity to impaired water bodies. NRCS will also consider cost effectiveness, and whether the landowner is able to contribute financially to the cost of implementing the easement. 7 C.F.R. § 1468.32. When reviewing applications for the ALE, NRCS will rank them according such criteria as the overall amount of prime or unique farmland soils that would be protected, what type of agricultural land the area is designated as, any decrease in the overall acreage of agricultural land in the area, and population density of the region. 7 C.F.R. § 1468.22.
The recently passed Inflation Reduction Act (“IRA”) authorized billions of dollars in funding for various conservation programs, including the ACEP. Specifically, the IRA provided $1.40 billion to extend funding for the ACEP through 2026. In authorizing the funding, the IRA stated that priority should be given to easements that will “most reduce, capture, avoid, or sequester carbon dioxide, methane, or nitrous oxide emissions[.]” H.R. 5376, 117th Cong. § 21001(a)(3). To learn more about the conservation provisions of the IRA, click here.
To read the section of the Farm Bill authorizing the ACEP, click here.
To read the regulations implementing the ACEP, click here.
For more information from NRCS on the ACEP, click here.
For more National Agricultural Law Center resources on conservation programs, click here.