Cost-Sharing Programs for Landowners: What are you Missing?

Posted on May 5, 2008

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The U.S. Department of Agriculture offers a variety of direct subsidies
and tax incentives to landowners that are aimed at preserving natural
resources. In many cases, and irrespective of the size of your parcel,
these programs are worth taking the time to investigate. You may find a
win-win scenario in which you benefit the environment as well as your
bottom line. Some of these programs include the Environmental Quality
Incentives Program (EQIP), the Wetland Reserve Program (WRP), the
Conservation Reserve Program (CRP), the Wildlife Habitat Incentive
Program (WHIP) and the Alabama Agricultural and Conservation
Development Commission Program (AACDCP).

While these programs are no doubt geared to benefit anyone who
qualifies, the right program is often overlooked or misunderstood
without a careful study. For example, consider a scenario in which you
own property that abuts a waterway or wetland area and your family has
no intention of selling it in the foreseeable future. You may have a
financial incentive to participate in the Wetland Reserve Program
(WRP). The Alabama Forestry Commission summarized the WRP program as
follows:

"The program offers three options: permanent easements, 30-year easements and restoration cost-share agreements with a minimum 10-year duration. For the permanent easement option, landowners receive the agricultural rental value of the land up to a specified maximum, and 100% of the cost of restoring the land. For the 30-year option, a landowner receives 75% of the easement value and 75% cost-share on the restoration. A 10-year agreement is also available that will pay 75% of the restoration cost. To be eligible, the land must be suitable for restoration or connected to adjacent wetlands. The owner’s access to land is retained, and hunting and fishing activities are permitted.”

Now consider a scenario in which you are interested in developing quail or turkey habitat for recreational hunting on your property. Your goals may align with the efforts of the Wildlife Habitat Incentive Program (WHIP). If you qualify for WHIP, the USDA will provide technical assistance and cost-sharing for habitat growth and maintenance at a rate of 60%. Contracts are 5-10 years long, and participants must have control of the land for the duration of the contract. 

Again, it may be a win-win to capitalize on one of these subsidized programs. Understand that funding for these programs is limited, and you should consult with your accountant and legal advisor before diving head-first. However, with the variety of programs available you may find an attractive and sensible option.

For additional information on these and other programs, you can visit www.al.nrcs.usda.gov/programs and www.forestry.state.al.us.

Brice Johnston, Goodrich Law Firm, LLC

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