-------------------------Indexing Terms------------------------- 
REPORTNUM:   RCED-99-247R						        

TITLE:     Conservation Reserve Program: Funding Reauirements for the Natural
Resources Conservation Service's Technical Assistance

DATE:   08/05/1999 
				                                                                         
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GAO/RCED-99-247R

GAO United States General Accounting Office

Washington, D. C. 20548 Resources, Community, and Economic Development
Division

B- 283233 August 5,1999 The Honorable Larry Combest Chairman, Committee on
Agriculture House of Representatives

Subject: Conservation Reserve Program: Funding Reauirements for the Natural
Resources Conservation Service's Technical Assistance

Dear Mr. Chairman: ‘The Conservation Reserve Program is a land
retirement program authorized to remove up to 36.4 million acres of highly
erodible or environmentally sensitive land from agricultural production. In
general, the program is financed through the borrowing authority of the
Commodity Credit Corporation, a government- owned corporation located within
the U. S. Department of Agriculture (USDA). USDA's Farm Service Agency
implements the program on behalf of the Corporation. In doing so, this
agency is assisted by USDA's Natural Resources Conservation Service, which
provides technical assistance. The Commodity Credit Corporation reimburses
the Conservation Service for this assistance.

Concerned about the Conservation Service's 6- week suspension of technical
assistance for the Conservation Reserve Program in the spring of 1999 and
about the possible reoccurrence of such a suspension, you asked to provide
information on budgetary authorities and other statutory requirements that
constrain the Conservation Service in carrying out congressional direction
on this program. Specifically, you asked us to provide information on (1)
the nature and costs of the Conservation Service's technical assistance; (2)
the reasons the Conservation Service suspended its technical assistance for
the program; (3) budgetary authorities and other statutory requirements that
constrain the Conservation Service's performance of technical assistance for
the program; and (4) the potential to use contractors to provide this
assistance in lieu of the Conservation Service.

RESULTS IN BRIEF The Natural Resources Conservation Service provides
technical assistance to support the Conservation Reserve Program, including
evaluating the environmental benefits of

Program Technical Assistance

B- 283233 the land offered for enrollment and preparing conservation plans
for the land accepted into the program. The Commodity Credit Corporation
reimburses the Conservation Service for this assistance in accordance with
the provisions of a Memorandum of Agreement signed by the Corporation, the
Conservation Service, and the Farm Service Agency. The Farm Service Agency,
which is principally responsible for implementing the program, makes the
final decisions on which land will be enrolled in it. In general, the
Conservation Service charges $98 to evaluate each parcel of land offered by
farmers for enrollment and $456 per parcel to prepare conservation plans for
land accepted for enrollment. The total cost of the Conservation Service's
technical assistance for the Conservation Reserve Program was $38.8 million
in fiscal year 1997, $49.2 million in fiscal year 1998, and an estimated
$46.9 million in fiscal year 1999.

The Conservation Service suspended most of its technical assistance for the
Conservation Reserve Program for about 6 weeks during the spring of 1999
because the Commodity Credit Corporation lacked sufficient funds to
reimburse the Conservation Service for this assistance. Specifically, the
Conservation Service, with the subsequent concurrence of the Farm Service
Agency, stopped providing technical assistance related to enrolling new land
in the program because the funds for reimbursing the Conservation Service
for this assistance were almost exhausted. However, follow- up work on land
already enrolled in the program continued uninterrupted because the
Conservation Service had already received its reimbursement. The funds used
to reimburse the Conservation Service were derived from unobligated funds
appropriated for the Conservation Reserve Program prior to fiscal year 1997.
The Conservation Service resumed providing technical assistance for this
program on May 17,1999, because of the imminent enactment of an emergency
supplemental appropriations act. This act became law on May 21,1999. Among
other things, the act provides up to an additional $28 million for technical
assistance for the program in fiscal year 1999.

According to USDA officials, the Conservation Service was constrained from
continuing its technical assistance for the program by limitations on
budgetary authorities and other statutory requirements after the unobligated
funds previously appropriated to the Conservation Reserve Program ran out.
Concerning budgetary limitations, the Conservation Service, in consultation
with an attorney in USDA's Office of General Counsel, concluded that it
could not use funds appropriated to its conservation operations budget
account to support the Conservation Reserve Program because the purposes for
which these funds were appropriated did not include this program. Concerning
other statutory requirements, legislative provisions related to the
Commodity Credit Corporation cap the amount of annual reimbursements made to
government agencies for supporting the Corporation's operations at $36.2
million. USDA officials maintain that nearly all of the $36.2 million has
been committed for other purposes in fiscal year 1999, and thus sufficient
funds were not available to reimburse the Conservation Service for the
technical assistance it provides for the Conservation Reserve Program.

In late 1998, the Farm Service Agency examined the potential to use
contractors to provide technical assistance. The agency identified a variety
of farming and

2 GAO/ RCED- 99- 247R Conservation Reserve Program Technical Assistance

B- 283233 conservation organizations as potential contractors. Agency
officials also said these entities could have been hired relatively quicMy
using purchase agreements. However, these officials also noted several
potential drawbacks to using these organizations as contractors, including a
lack of consistency across these organizations in terms of technical skills;
concerns about the ability of these organizations to uniformly apply the
criteria used to evaluate the environmental benefits of land offered for the
Conservation Reserve Program; and questions about the availability of
suitable contractors in some rural areas.

BACKGROUND The Conservation Reserve Program (CRP) was established in 1985
with several objectives: to reduce water and wind erosion, protect the
nation's long- term capability to produce food and fiber, reduce
sedimentation, improve water quality, create and enhance wildlife habitat,
and encourage permanent conservation practices. ' The program encourages
private land owners, such as farmers, to remove highly erodible cropland or
other environmentally sensitive acreage from production and apply
conservation measures to reduce and control erosion and the impairment of
water quality. USDA provides farmers or other private landowners with an
annual payment- known as a rental payment- for the term of the multiyear
contract- usually 10 to 15 years- for taking the land out of production and
shares the costs of applying the necessary conservation measures.

The Farm Service Agency is the USDA agency with primary responsibility for
implementing CRP. Specifically, this agency is responsible for (1) issuing
federal regulations and other public announcements, such as notices of
future signup periods, that govern the operation of the program; (2)
determining which parcels of land are enrolled in the program, on the basis,
in part, of the Conservation Service's evaluation of the land offered for
enrollment; (3) determinin g the allowable amount of rental and cost- share
payments that will be made under each enrollment contract; and (4) issuing
these rental and cost- share payments to program participants (farmers or
other private landowners). According to Farm Service Agency officials,
because the agency's field staff lack the specific skills and expertise
needed to perform technical assistance, they depend on Conservation Service
to provide this support.

Land may be enrolled in the program by three means: (1) a general signup,
which competitively selects the most environmentally sensitive land (most
land is enrolled in the program by this method); (2) a continuous
noncompetitive signup of highly desirable environmental practices, such as
filter strips (areas of grass or other vegetation that filter runoff by
trapping sediment, pesticides, or other polhnants) and riparian buffers
(areas of trees and/ or shrubs next to ponds, lakes, and streams that filter
pollutanm from runoff as well as provide shade, food sources, and shelter
for fish and other wildlife);

1 The Conservation Reserve Program was established under title XII of the
Food Security Act of 1985, P. L No. 99- 198,99 Stat. 1354 (Dec. 23,1985).

GAO/ RCED- 99- 247R Conservation Reserve Program Technical Assistance

B- 283233 and (3) the Conservation Reserve Enhancement Pr~ gram,~ which
combines the resources of the federal and state governments to address
targeted environmental concerns- such as the Chesapeake Bay. As of October
1998, about 30 million acres were enrolled in CRP. Funding for this program
amounted to about $9.2 billion for tical years 1994 through 1998. Program
funding for fiscal year 1999 was estimated at $1.7 billion.

With the passage of the Federal Agriculture Improvement and Reform Act of
1996 (P. L. 104127, Apr. 4,1996)- more commonly known as the 1996 farm bill-
CRP became a program of the Commodity Credit Corporation, a government-
owned corporation within USDA. ' In general, the Corporation's programs, 4
including CRP, are classified as mandatory spending programs, and therefore
the Corporation does not require annual appropriations in order to make
outlays for them. Instead, the Corporation borrows funds from the Department
of the Treasury to finance these programs; this borrowing is later repaid
with appropriated funds5

Provisions of the 1996 farm bill limit the Corporation's funding for the
reimbursement of agencies within USDA and other government entities for
their support of the Corporation's programs. This limit on reimbursements,
also known as the reimbursement cap, sets a ceiling on the amount of
obligations that the Corporation can make for this purpose each year. As
provided for in the farm bill, the cap is based on the level of these
obligations made in fiscal year 1995-$ 36.2 miRion. 6 Reimbursements related
to CRP were not included in this cap because this program was not funded
through the Corporation's borrowing authority in fiscal year 1995.7 Instead,
reimbursements for the provision of technical assistance for this program
were to be made from unobligated funds appropriated to CRP prior to fiscal
year 1997. At the start

' The Conservation Reserve Enhancement Program began in 1997. Since its
inception, about $350,000 has been obligated to carry out its objectives.

a The Commodity Credit Corporation was originalIy chartered in 1933 under a
Delaware oharter and was reincorporated in 1948 as a federal corporation
within USDA by the Commodity Credit Corporation Charter Act (P. L. 80806,
June 29, 1948). The Corporation was established to stabilize, support, and
protect farm incomes and prices and to assist in maintaining balanced and
adequate supplies of agricuItnrsl commodities and in facihtating their
orderly distribution. It carries out this mission by financing a variety of
farm income and commodity support programs through direct payments and loans
to farmers.

' In addition to its income and commodity support programs, the Commodity
Credit Corporation's mission has been expanded in recent years to include
the financing of a range of commodity export, resource conservation, and
disaster assistance progrsms.

5 For a more detailed discussion of the Corporation's financial operations,
see Commodity Information on the Availabilitv. Use. and Management of Funds,
(GAO/ RCED- 98114, Apr. 28,1998).

‘This cap was originaEy calculated as $45.6 million per year starting
with fiscal year 1997. However, USDA has made several adjustments to the cap
to correct errors in its original cap calculation; the net effect of these
corrections is to reduce the cap to $36.2 million.

' CRP was funded through the Corporation's borrowing authority in fiscal
years 1986 and 1987. From iiscaI year 1988 through fiscal year 1995, this
program was financed through annuaI appropriations. According to USDA
officials, however, ifin any of these years the program had not received an
appropriation, USDA was authorized to use the Corporation's borrowing
authority to carry out the program's operations. Thus, in the view of these
officials, CRP was technicahy a Corporation program even before the 1996
Farm Bill's enactment.

4 GAO/ RCED- 99- 247R Conservation Reserve Program Technical Assistance

B- 283233 of fiscal year 1997, these unobligated funds amounted to $134
million. Thus, the Natural Resources Conservation Service was reimbursed
with these unobligated funds.*

NATURAL RESOURCES CONSERVATION SERVICE'S TECHNICAL ASSISTANCE FOR THE
CONSERVATION RESERVE PROGRAM AND ITS COSTS

The technical assistance the Natural Resources Conservation Service provides
for the Conservation Reserve Program includes evaluating land offered for
enrollment in the program and, for the land accepted for enrollment,
preparing conservation plans that outline the measures that will be
undertaken on this land to reduce erosion and protect water quality. In
addition, the Conservation Service provides assistance to farmers and other
private landowners to install and maintain these conservation measures;
however, this installation and maintenance is primarily the landowner's
responsibility. According to USDA officials, the Conservation Service's
field staff, located in about 2,500 county offices, are USDA staff that are
uniquely qualified to provide this type of assistance. For example, these
staff have expertise in such fields as agronomy, biology, engineering, range
management, and soil science, which are needed to assess the environmental
benefits of land offered for enrollment and to plan and implement
conservation measures on land enrolled in the program.

Regarding the evaluation of land offered for enrollment, the Conservation
Service determines whether each parcel of land offered meets CRP's
eligibility criteria, including whether the land is highly erodible or
otherwise environmentally sensitive. The Conservation Service also evaluates
the relative merits of the land on the basis of the potential environmental
and conservation benefits obtained by its enrollment in CRP. To do this, the
Conservation Service completes an Environmental Benefits Index form to
evaluate the land on the basis of such criteria as the expected
environmental improvement in soil resources, water quality, and wildlife
habitat. g The relative cost of enrolling the land- the annual rental
payments and cost- share benefits the landowner is seeking- are also a
factor in making enrolhnent determinations. 10

Before the Farm Service Agency and landowner sign an enrollment contract,
the Conservation Service assists the landowner in developing a conservation
plan for the land to be enrolled. This plan outlines the measures the
landowner will undertake in exchange for the annual rental payments provided
under the program. Among other things, the plan includes a schedule of the
operations, activities, and estimated expenditures needed to implement these
measures, such as establishing a permanent vegetative cover (grass, trees,
or shrubs) on the land. The final conservation plan must be approved by the
Conservation Service and the local conservation district in which the

' Some of these funds were also used to reimburse the U. S. Forest Service,
which has a relatively minor role in providing technical assistance for the
Conservation Reserve Program.

' Using this form, the Conservation Service scores- assigns a numerical
value- to each offer. Generally, the higher the score, the more the
environmental benefits of the offer.

” Under the continuous sign- up program, land that meets certain
criteria automatically qualifies for CRP enrollment. GAO/ NED- 99- 247R
Conservation Reserve Program Technical Assistance

B- 283233 land is located.” After the land is enrolled, the
Conservation Service provides technical advice to landowners, when
requested, regarding the installation and maintenance of the conservation
measures called for in their conservation plans.

The Conservation Service currently charges the Commodity Credit Corporation
$98 to evaluate parcels of land offered for enrollment in CRP and $456 per
parcel to develop conservation plans for land accepted for enrolhnent. This
latter fee is a one- time charge intended to cover all technical assistance
provided by the Conservation Service over the life of a CRP enrollment
contract. According to Conservation Service officials and related
documentation, these rates, which became effective in fiscal year 1998, are
based on the actual time charged by Conservation Service field staff for the
technical assistance they provided to CRP between March 2,1997, and June
21,1997, and the salary and employee benefits related to these time charges.
The rates were also agreed to in a Memorandum of Agreement, revised
annually, and signed by the Corporation, the Conservation Service, and the
Farm Service Agency. The total cost of the Conservation Service's technical
assistance for CRP was $38.8 million in fiscal year 1997, $49.2 million in
fiscal year 1998, and an estimated $46.9 million in fiscal year 1999.

THE NATURAL RESOURCES CONSERVATION SERVICE SUSPENDED ITS TECHNICAL SUPPORT
FOR CRP BECAUSE OF INSUFFICIENT FUNDS FOR THIS PURPOSE

The Conservation Service suspended most of its technical assistance for the
Conservation Reserve Program for about 6 weeks during the spring of 1999
because there were insufficient funds to reimburse the Conservation Service
for this assistance. Specificahy, on April 7,1999, the Conservation Service,
with the subsequent concurrence on April 12,1999, of the Farm Service
Agency, stopped providing technical assistance related to enrolling new land
into the program because the funds for reimbursing the Conservation Service
for this assistance were almost exhausted. However, follow- up work on land
already enrolled in the program continued uninterrupted because the
Conservation Service had already received its reimbursement. The funds used
to reimburse the Conservation Service were derived from unobligated funds
appropriated for CRP prior to fiscal year 1997. The Conservation Service
resumed its technical assistance for the program on May 17,1999, because an
emergency supplemental appropriations act was about to be enacted. On May
21,1999, this act became law. Among other things, the act provides up to an
additional $28 million from the Commodity Credit Corporation for technical
assistance for CRP during fiscal year 1999.‘ 2

” A conservation district is a legal subdivision of state government,
with an elected governing body, which develops and implements soil and water
conservation programs within a certain area, usually coinciding with county
lines.

‘* This act also provided up to an additional $35 million from the
Conunodi~ Credit Corporation for technical assistance for CRP in fiscal year
2000.

6 GAO/ RCED- 99- 247R Conservation Reserve Program Technical Assistance

B- 283233 Purposes of the Susuension On April 7,1999, the Conservation
Service, with the subsequent concurrence of the Farm Service Agency,
suspended most of its technical assistance for CRP. Assistance was suspended
in order to determine how much of the unobligated funds used to reimburse
the Conservation Service remained for the balance of fiscal year
1999.” The suspension also allowed the Conservation Service, in
conjunction with the Farm Service Agency, to determine priorities on how to
best use the unobligated funds that remained. The suspension applied to the
provision of technical assistance for new offers of land for enrollment.
However, the suspension did not apply to follow- up technical assistance for
land already enrolled in the program. According to USDA officials, payment
for this follow- up work is covered in the original reimbursement the
Conservation Service received to prepare conservation plans for enrolled
land.

When the suspension was undertaken, the Conservation Service and the Farm
Service Agency had expected CRP technical assistance to resume by April
16,1999. However, the agencies discovered that the unobligated funds used
for this purpose were nearly exhausted, with only about $10,500 available
for the balance of fiscal year 1999. According to USDA officials, although
they were surprised by how little funding remained, the fact that
unobligated funds would not carry them through fiscal year 1999 was
anticipated. For example, in a September 1998 memorandum from the Farm
Service Agency's Administrator to USDA's Under Secretary for Farm and
Foreign Agricultural Services, the Administrator observed that a shortfall
in the funding needed for CRP technical assistance in fiscal year 1999 was
expected, largely because of (1) an increase in the rate the Conservation
Service charged for evaluating land offers- the Conservation Service
increased this rate from $77 to $98 per parcel in 1998- and (2) charges that
were not reimbursed prior to fiscal year 1998 for preparing new conservation
plans for re- enrolled acreage. 14 USDA officials advised the Congress in
appropriations hearings held in February and March 1999 that the unobligated
funds used for CRP technical assistance would likely run out before the end
of fiscal year 1999.

” The U. S. Forest Service also suspended its technical assistance for
CRP on April 7,1999, for the same purpose. ” Per the Memorandum of
Agreement signed by the Commodity Credit Corporation, the Conservation
Service, and the Farm Service Agency, starting in fiscal year 1998 the
Conservation Service was to receive a reimbursement of $456 per parcel for
conservation planning work on those m- enrolled acres when one or more of
the following conditions occurred: (1) contracts were reduced in size and
(2) contra& required significant revision because of the enhancement of the
Environmental Benefits Index. In these cases, the Conservation Service is
required to develop detailed conservation plans, e& mate the cost of
conservation measures, oversee the implementation of these measures, and
perform other work as if the m- enrolled land was being enrolled in CRP for
the first time. According to USDA officials, the Conservation Service and
the F- arm Service Agency negotiate which re- enrolled land requires this
level of technical assistance from the Conservation Service.

GAO/ RCED- 99- 247R Conservation Resewe Program Technical Assistance

B- 283233 ResumDtion of Technical Assistance On May 17,1999, the
Conservation Service resumed CRP technical assistance because an emergency
supplemental appropriations act was about to be enacted. This act, the 1999
Emergency Supplemental Appropriations Act (P. L. 106- 31), became law on May
21, 1999. Among other things, it provides up to an additional $28 million
for technical assistance for CRP and the Wetlands Reserve Program in fiscal
year 1999.” However, according to USDA officials, because technical
assistance for the wetlands program is already fully funded, the $28 million
in funds available under the emergency supplemental appropriations act will
be used only for CRP technical assistance.

USDA formalized its resumption of technical assistance for CRP in a May
28,1999, memorandum that was signed by the Conservation Service and the Farm
Service Agency. 16 However, as of July 27,1999, USDA had not requested an
apportionment'7 from the Office of Management and Budget of the funds
provided for CRP technical assistance in the emergency supplemental
appropriations act.”

According to USDA officials, the $28 million available under the emergency
supplemental appropriations act may not be sufficient to cover the costs of
CRP technical assistance through the end of fiscal year 1999. According to
these officials, the Department had sought $31 million in additional funding
for this technical assistance in the appropriations act. They indicated that
the difference ($ 3 million) between the amount appropriated versus the
Department's request could leave USDA short of funding for CRP technical
assistance by the end of the fiscal year.” According to the officials,
a possible shortfall will largely depend on the level of activity under the
continuous signup portion of CRP; land that meets certain minimal criteria
is automatically enrolled under this part of the program, subject to
available funds.

‘bAdministered by the Conservation Service on behalf of the Commodity
Credit Corporation, the Wetlands Reserve Program provides land rental and
restoration cost- share payments to landowners who permanently return
converted or fanned wetlands to their prior wetlands condition.

“The May 28,1999, memorandum also indicated that the U. S. Forest
Service would resume its technical assistance for CRP.

“An apportionment is the action by which the Office of Management and
Budget distributes funds available for obligation, including budgetary
reserves established pursuan t to law, in an appropriation or fund account.

I' We have asked USDA for a written explanation of the source of funding for
the Conservation Service's resumption of CRP technical assistance before the
enactment of the 1999 Emergency Supplemental Appropriations Act. We have
also asked why USDA has not requested or received an apportionment by the
Office of Management and Budget of the supplemental appropriation, as
required by 31 USC. 1517.

” USDA is concerned about a similar funding shortfall in fiscal year
2000. Specifically, USDA officials indicated that the $35 million in
Commodity Credit Corporation funding for CRP technical assistance in fiscal
year 2000, as provided for in the supplemental appropriations act, may be
insufficient. These officials said an addition $5 million may be needed for
anticipated new activity under the program in that year.

8 GAO/ RCED- 99- 247R Conservation Resewe Program Technical Assistance

B- 283233 BUDGETARY AUTHORITIES AND OTHER STATUTORY RE( XJIREMENTS AFFECTING
THE CONSERVATION SERVICE'S PROVISION OF TECHNICAL ASSISTANCE FOR THE
CONSERVATION RESERVE PROGRAM

The Natural Resources Conservation Service's principal source of technical
assistance funds is its conservation operations appropriation. However, in
an October 7,1998, memorandum, an attorney in USDA's Office of General
Counsel notified Conservation Service officials that the Conservation
Service could not use its conservation operations appropriation to fund
technical assistance for CRP because this appropriation does not provide
funds for this purpose. This attorney also noted that the Conservation
Service's performance of technical assistance for the program without
adequate funds being legally available would be a violation of the Anti-
Deficiency Act, as amended (31 U. S. C. 1341).

Furthermore, as discussed, legislative provisions of the 1996 farm bill
capped at $36.2 million the amount of Commodity Credit Corporation funds
that could be used to reimburse federal and state government agencies for
their support of the Corporation's operations20 According to USDA officials,
nearly all of this $36.2 million has been committed for other purposes in
fiscal year 1999. Thus, despite the fact that CRP is a program of the
Corporation, sufficient funds are not available under the reimbursement cap
to cover the costs of the Conservation Service's technical assistance for
this program. These officials noted that unless the amount of this cap is
increased in the future, the use of the Corporation's funds to reimburse the
Conservation Service for technical assistance for CRP will only be possible
when specifically provided for in appropriations legislation. 21

THE FARM SERVICE AGENCY HAS IDENTIFTED POTENTIAL CONTRACTORS AND A WAY TO
HIRE THEM CXJ- ICKL, Y TO PROVIDE TECHNICAL ASSISTANCE FOR THE CONSERVATION
RESERVE PROGRAM

The Farm Service Agency has examin ed the potential to use contractors to
provide technical assistance for the Conservation Reserve Program. The
agency undertook this analysis in late 1998 because it anticipated future
problems in the Natural Resources Conservation Service's provision of this
assistance as a result of funding uncertainties. The Farm Service Agency's
analysis did not address the relative costs of each approach. Instead, it
focused on the identification of possible contractors and a mechanism to
hire them quickly if the Conservation Service had to suspend its technical
assistance for the program for an indeterminate length of time. According to
Farm Service Agency officials, a variety of farming and conservation
organizations were identified as potential

2o These provisions are found in section 161 of the 1996 farm bill, which
amended section 11 of the Commodity Credit Corporation Charter Act.

*' USDA officials also said that under section 11 of the Commodity Credit
Corporation Charter Act, the Secretary of Agriculture could direct a USDA
agency to provide services to the Corporation, including technical
assistance for CRP, on a nonreimbursable basis. In addition, these officials
said that there may be other funds available for the provision of these
services, such as the reprogramming of funds from other purposes. Further
elaboration on these funding issues may be provided in USDA's response to
our request described in footnote 18.

9 GAO/ RCED- 99- 247R Conservation Resewe Program Technical Assistance

B- 283233 contractors. These officials also said these organizations could
have been hired relatively quickly using purchase agreements and that these
agreements would have been funded through the borrowing authority of the
Commodity Credit Corporation in light of CRP's status as a Corporation
program. However, these officials also noted several potential drawbacks to
using these organizations, including a lack of consistency across these
organizations in terms of technical skills; concerns about the ability of
these organizations to uniformly apply the evaluative criteria used in
completing the Environmental Benefits Index form; and questions about the
availability of suitable contractors in some rural areas.

Relatedly, USDA officials also indicated that the Farm Service Agency is not
required by statute to use the Conservation Service for the provision of
technical as+ tance for CRP. Similarly, the Conservation Service is not
required by statute to provide this assistance. Thus, these officials
indicated that the Farm Service Agency has the latitude to hire contractors
to provide this technical assistance. However, Farm Service Agency .
officials indicated that they prefer to continue using the Conservation
Service for this assistance, noting that the Conservation Service's field
staff have the skills, expertise, and experience needed to provide this
assistance. These officials also noted that the Conservation Service's
provision of this assistance ensures a nationwide, consistent application of
evaluative criteria in completing the Environmental Benefits Index form.

AGENCY COMMENTS We provided a draft of this report to USDA for its review
and comment. We met with officials of the Conservation Service, including
the Deputy Chief for Programs; the Farm Service Agency, including the
Director of the Conservation and Environmental Programs Division; the Office
of General Counsel, including the Assistant General Counsel for the
International Affairs and Commodity Programs Division; and the Office of
Budget and Program Analysis and the Office of the Inspector General. The
officials generally agreed with the information presented in the report.
These officials also provided a number of technical changes and
clarifications to the report, which we incorporated as appropriate.

SCOPE AND METHODOLOGY To determine the nature and costs of the Conservation
Service's technical assistance for the Conservation Reserve Program as well
as the reasons the Conservation Service suspended its technical assistance,
we interviewed and obtained documentation from officials of the Conservation
Service and Farm Service Agency. To determine the budgetary authorities or
statutory requirements that may constrain the Conservation Service from
performing technical assistance for the program, we interviewed and obtained
documentation from officials of the Conservation Service, Farm Service
Agency, and USDA's Office of General Counsel. We also reviewed applicable
legislation and legislative histories.

10 GAWRCED- 99- 247R Conservation Reserve Program Technical Assistance

B- 283233 To determine the potential to use contractors to provide technical
assistance for CRP in lieu of the Conservation Service, we interviewed and
obtained documentation from officials of the Conservation Service and the l%
rm Service Agency. Because neither agency has prepared an analysis comparing
the costs of using the Conservation Service's staff versus private
contractors to perform this technical assistance, we were unable to assess
these comparative costs in the limited time available for this review.

We conducted our review from May 1999 through July 1999 in accordance with
generally accepted government auditing standards.

As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days after
the date of this letter. At that time, we will provide copies to appropriate
congressional committees; interested Members of Congress; the Honorable Dan
Glickman, Secretary of Agriculture; the Honorable Jacob Lew, Director of the
Office of Management and Budget; and other interested parties. We are also
making copies available to others upon request.

If you have any questions about this report, please contact James R. Jones,
Jr. or me at (202) 512- 5138. Key contributors to this report were James
Dishmon, Oliver Easter- wood, and Richard Shargots.

Sincerely yours, Agriculture Issues

11 GAO/ RCED- 99- 247R Conservation Reserve Program Technical Assistance

RELATED GAO PRODUCTS Water Qualitv: Federal Role in Addressing- and
Contributina to- Norwoint Source Pollution (GAOLRCED- 99- 45, Feb. 26,1999).

Commoditv Credit Cornoration: Information on the Availabilitv. Use, and
Management of Funds (GAOLRCED- 98- 114, Apr. 28,1998).

Conservation Reserve Program: Alternatives Are Available for Managing
Environmentallv Sensitive Cronland (GAO/ RCED- 95- 42, Feb. 21,1995).

(150146) 12 GAOIRCED- 99- 247R Conservation Reserve Program Technical
Assistance

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