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The Food, Conservation, and Energy Act of 2008 (2008 Farm
Act) includes a 5-fold increase in mandatory funding for
organic programs over funds mandated in the previous legislation,
and authorizes additional funding for many of these programs.
Most of the mandatory funds go to two existing organic
programs, the organic research program and cost-share assistance
program to help growers and handlers with organic certification
costs. The legislation includes new organic provisions
on credit, trade, and crop insurance. Organic provisions
are also included in the Conservation Title for the first
time, and are aimed at helping producers with the transition
to organic farming systems.
Organic Provisions
A new title—Horticulture and Organic Agriculture—is introduced
in the 2008 Act, and five other titles (Conservation, Trade,
Credit, Research, and Crop Insurance) now include organic
provisions.
Conservation Title (II)
- The Organic Transition Support provision makes
conservation practices related to organic production
and transition eligible for Environmental Quality Incentives
Program (EQIP) payments, subject to a $20,000 annual
limit and an $80,000 cap over a 6-year period.
- Technical Assistance on Organic Conservation Practices will
be developed to ensure that conservation practices and
resource mitigation measures designed specifically for
organic farming systems are available and are reflected
in USDA's conservation-practice standards. Technical
assistance will be made available for implementing conservation
practices for specialty crops and organic and precision
agriculture.
- An Organic Certification Cross-Link is established
to provide producers a way to initiate organic certification
while participating in the Conservation Stewardship Program
(CStP). Technical assistance and outreach on organic
farming systems will also be developed, and the CStP
program specifications that are developed will be appropriate
for organic producers.
- The Organic Transition Incentives for Beginning
Farmers provision, under the Conservation Reserve
Program (CRP), provides special treatment of CRP land
transitioning from retiring farmers or ranchers to
beginning or socially disadvantaged farmers or ranchers.
Most noteworthy, beginning 1 year prior to the CRP
contract termination date, a new farmer or rancher
would be allowed to make land improvements and begin
the organic certification process.
Trade Title (III)
- A Market Access Program (MAP) Amendment on Organic
Products explicitly includes commodities that
are organically produced in this program. MAP was created
in the Agricultural Trade Act of 1978 to provide cost-share
funding to expand markets for U.S. agricultural products
through technical assistance, market research, and
promotion of U.S. value-added products. Participating
organizations include nonprofit agricultural organizations,
regional trade groups, and U.S. private companies.
Credit Title (V)
- An Organic Credit Provision under the Conservation
Loan and Loan Guarantee Program gives priority to qualified
beginning farmers, ranchers, socially disadvantaged farmers
or ranchers, owners or tenants who use the loans to convert
to sustainable or organic agricultural production systems,
and producers who use the loans to build conservation
structures or establish conservation practices.
Research Title (VII)
- Mandatory CCC funding for the Organic Agriculture
Research and Extension Initiative has increased
from $15 million over the life of the previous 2002
legislation, to $78 million for FY 2009-12. An additional
$25 million annually for FY 2009-12 is authorized,
subject to appropriations. Two new priorities have
also been added to the purpose of this initiative:
(1) to study conservation and environmental outcomes
of organic practices, and (2) to develop new and improved
seed varieties for use in organic production systems.
Horticulture and Organic Agriculture Title (X)
- Increases mandatory funding for National Organic
Certification Cost-Share Program to $22 million
in FY 2008, up from $5 million in FY 2002, to remain
available until expended. Maximum Federal cost share
remains at 75%, but the cap increases to $750/operation.
State and Federal recordkeeping requirements are added,
and the Secretary is required to submit an annual report
to Congress describing State expenditures.
- First-time mandatory CCC funding, set at $5 million,
is included for expanded Organic Production and Marketing
Data Collection, to be available until expended over
5 years. An additional $5 million/year is authorized
for organic production and data. The purposes of this
provision are to collect and distribute comprehensive
reporting of prices relating to organically produced
agricultural products, conduct surveys and analysis and
publish reports relating to organic production, handling,
distribution, retail, and trend studies (including consumer
purchasing patterns), and develop surveys and report
statistical analysis on organically produced agricultural
products. The Secretary is to submit a progress report
on implementation of this initiative.
- Support for the National Organic Program is
included for the first time in the 2008 Farm Act, which
authorizes $5 million in funding in FY 2008 (currently
$2.6 million) for USDA's program that regulates organic
standards and certification. Authorized funding increases
to $11 million by FY 2012.
Crop Insurance Title (XII)
- An Organic Crop Insurance Provision is included
in the 2008 Farm Act requiring The Federal Crop Insurance
Corporation (FCIC) to contract for studies of organic
production coverage improvement. Unless studies document "significant,
consistent, and systemic variations in loss history between
organic and non-organic crops," the FCIC is required
to eliminate or reduce the premium surcharge for organic
production. These studies are also required to include
the development of procedure to offer additional price
election that reflects the actual prices received for
organic crops.
Economic Implications
Organic producers have been challenged in recent years
to keep up with the fast-growing demand for organic products
in the U.S., which grew 21 percent in 2007 to reach $20
billion in sales. The Farm Act significantly expands support
for existing organic research and regulatory programs,
and provides new incentives for producers wishing to convert
to organic production systems. Greater Federal support
could mean more organic farms and production in the U.S.
as consumer demand continues to swell.
Meeting the Challenges of Organic Agriculture
Numerous challenges—such as limited research and
education on organic farming systems, inadequate information
on marketing and prices, and limited access to Federal
programs—have
slowed adoption of organic farming systems (see
the readings page: Clarkson, 2007; Durham, 2006). The 2008 Act addresses
many of these obstacles with new funding and provisions.
The 2008 Act includes provisions to increase access for
organic producers to Federal credit, trade, and crop insurance
programs and bolsters funding for research on organic agriculture,
economic data collection, and producer subsidies for certification
fees. Most certifiers structure their fee schedules on
a sliding scale, with fees increasing as the organic operation's
size—usually measured by gross sales or acres operated—increases.
The new legislation raises the payment cap to $750 per
operation, enough to cover a substantial portion of the
certification fees for smaller operations. New economic
data will target high priority issues in the organic sector,
including expanded organic price reporting for produce.
USDA already publishes organic price reports for food and
feed grains, poultry and eggs, but coverage for produce
has been incomplete because of the large number of fruit
and vegetable crops grown in the U.S.
New provisions are also included in the 2008 Act to assist
farmers during the three years it typically takes to convert
to organic production. USDA organic regulations require
documentation of a 3-year transition period, during which
land must be managed under approved practices, before crop
or pasture acreage can be certified as organic and qualify
for organic price premiums. New provisions in the Conservation
Title make conservation practices related to organic production
and transition eligible for payments under the Environmental
Quality Incentives Program (EQIP), subject to a $20,000
annual limit and an $80,000 cap over a 6-year period. Although
a few States had offered transition payments under EQIP
in the past, their payment rates were low, and most States
did not offer this option.
The 2008 Act also includes provisions to increase the
availability of technical assistance on organic production.
Many nongovernmental organizations—such as Midwest Organic & Sustainable
Education Service, Ecological Farming Association, and
Carolina Farm Stewardship Association have developed expertise
over the last several decades in delivering organic educational
and technical assistance. These groups may play an instrumental
role in helping state and federal agencies increase the
level of technical assistance on organic agriculture.
New Research to Examine the Environmental Benefits
of Organic Farming
Mandatory funds for research on organic farming and marketing
increase 5-fold over levels mandated in the 2002 Act, and
account for nearly three-quarters of the total mandatory
organic funds in the 2008 Act. The Organic Agriculture
Research and Extension Initiative was launched in 2002
with only $15 million in mandatory funds, and the number
of high-quality research applications for this competitive
grant program has substantially exceeded program funding.
One new purpose of this initiative is to develop new and
improved seed varieties for use in organic production systems.
Interest in organic seed variety development was heightened
after USDA banned the use of seeds treated with fungicides
and the use of genetically modified organisms, including
genetically modified seeds, when national organic standards
were implemented in October 2002 (see 2007
National Organic Research Agenda—Soils, Pests, Livestock,
Genetics: Outcomes from the Scientific Congress on Organic
Agricultural Research (SCOAR)).
The other new purpose is to study the conservation and
environmental outcomes of organic practices. The underlying
principles of organic agriculture revolve around land stewardship,
and USDA's regulatory standards define organic production
as a system that responds "to site-specific conditions
by integrating cultural, biological, and mechanical practices
that foster cycling of resources, promote ecological balance,
and conserve biodiversity" (see National
Organic Program; Final Rule, 7 CFR Part 205). Although
experimental trials have found enhanced soil fertility,
higher biodiversity, lower energy use, and increased retention
of carbon and nitrogen in organic plots compared with conventional
plots (see the readings
page: Mäder et al.,
2002; Reganold et al., 2001; Drinkwater, Wagoner, and Sarrantonio,
1998), more comprehensive research is needed. The potential
of organic farming to capture atmospheric carbon and store
it in the soil was specifically mentioned in the conference
report of the 2008 Act as an example of research that needs
support.
See related readings
on organic program provisions; visit the complete
2008 Farm Act side-by-side.
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