The linkage between conservation compliance and crop insurance premium subsidies continues to draw complaints

OMAHA (DTN) -- The linkage between conservation compliance and crop insurance premium subsidies continues to draw complaints, but a new study by USDA's Economic Research Service shows the link helps reduce the farming risks on highly erodible lands and wetland conversions. Coupling insurance and conservation compliance in the 2014 farm bill has helped reduce erosion on highly erodible land. The study found that if Congress were to take away the link to the crop insurance subsidy, then conservation compliance on highly erodible land would fall from 25 million acres to closer to 14 million. The incentives for reducing erosion on those highly erodible fields would be gone. "There are a lot of farmers that just move into lower incentive categories by removing that link," said Roger Claassen, an ERS economist and one of the study's lead authors. Compliance for crop insurance continues to have its critics, including Senate Agriculture Committee Chairman Pat Roberts, R-Kan. At a recent hearing, Roberts asked insurance professionals about problems with conservation compliance linkage to crop insurance. Roberts added that he felt in 2014 that the link to insurance was "unneeded, costly, burdensome." William Cole, chairman of the Crop Insurance Professionals Association, told senators the intention of the 2014 language was to bring more farmers into compliance, but the paperwork became a hassle for some. "If this stays in, we have got to simplify it without the penalties where they lose coverage," Cole said. Cole later noted that the insurance professionals are not saying conservation compliance is a bad thing. "We're not saying conservation compliance is not a good thing. Our producers need to be in compliance, but I think it's more the regulatory timing aspect of it as far as when they get their paperwork filed with the Farm Service Agency," Cole said. Farmers are at risk of losing their crop insurance premium subsidies and access to other commodity and conservation funds, as well as USDA farm loans, if they are found to be out of compliance with basic conservation measures on highly erodible lands and wetlands. The incentives to remain in compliance with conservation provisions shifted in the 2014 farm bill not just because of the compliance link, but also because of ending Direct Payments, the ERS report notes. The commodity title of the farm bill was reduced, and that shifted the major safety net protection to crop insurance and the premium subsidy that farmers receive. At the time, it was also noted only about 36% of farmers received commodity or conservation payments, but as much as 93% of cropland was on farms that either received commodity payments or crop insurance premium subsidies.