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Policy Update: Senate Leadership Releases New Reconciliation Bill that Includes Conservation Funding

Last night, Senate Majority Leader Schumer (D-NY) and Senator Manchin (D-WV) announced that they had reached a deal on a new bill entitled the “Inflation Reduction Act” (see summary here). In total, the bill is expected to invest roughly $370 billion in energy and climate—including over $20 billion for agricultural conservation programs and related technical assistance. The legislation is also expected to raise $739 billion in revenue through tax changes and prescription drug reform. AFT expressed support for the conservation provisions in a statement released earlier today.  

In total, the bill includes a nearly $40 billion investment in agriculture, forestry, and rural communities, with $19.85 billion dedicated to four USDA conservation programs: the Environmental Quality Incentive Program (EQIP), the Conservation Stewardship Program (CSP), the Regional Conservation Partnership Program (RCPP), and the Agricultural Conservation Easement Program (ACEP). The legislation would also authorize these programs past their current expiration dates through FY 2031, although the new funding would only last for 4 years. An additional $1 billion is included in the bill for Conservation Technical Assistance and another $300 million is provided for the measurement and reporting of program-related climate outcomes. This funding package is similar to what was proposed in last year’s Build Back Better Act which failed to pass the Senate. One exception being that the Inflation Reduction Act does not include a specific cover crop program. The full funding breakdown is included below.  

The bill currently places significant emphasis on helping farmers and ranchers address climate change. The language directing the use of this new funding specifies that it go toward agricultural conservation practices, enhancements, or agreements that improve soil carbon, reduce GHG, or capture or sequester GHG. It applies not just to cost share programs, but also to ACEP projects. It should be noted that this language still needs to be approved by the Senate Parliamentarian for inclusion in the final bill. 

Passage of the Inflation Reduction Act (IRA) would employ a procedure called “reconciliation.” Last used for the American Rescue Plan Act in March 2021, budget reconciliation is a tool that allows Congress to pass legislation related to spending or revenue with a simple majority, thereby avoiding the Senate filibuster requirement of 60 votes.  

The timing for a vote on the legislation is uncertain given the need for review by the Senate Parliamentarian. However, a vote on the bill could occur as early as next week. If the legislation passes the Senate, it could quickly clear the House of Representatives and be signed into law by the President.  

The full funding breakdown of the legislation’s agricultural conservation components is included below: 

• $8.45 billion for EQIP through Fiscal Year (FY) 2026 

• • $250M in FY23; $1.75B for FY24; $3B for FY25; $3.45b for FY26 
  • Does not contain a livestock carve-out (currently, 50% of funding goes toward livestock practices) 
  • Doubles Conservation Innovation Trials with language prioritizing proposals that utilize diet and feed management to reduce enteric methane emissions from ruminants 

• $6.75 billion for RCPP through FY26 

• • $250M in FY23; $1.2B for FY24; $2.25B for FY25; $3.05B for FY26 
  • May prioritize projects that— 

• • • Leverage corporate supply chain sustainability commitments; or 
    • Utilize models that pay for outcomes from targeting methane and nitrous oxide emissions associated with agricultural production systems  

• $3.25 billion for CSP through FY26 

• • $250M in FY23; $500M for FY24; $1B for FY25; $1.5B for FY26 
  • Contains state and regional specific climate bundles 

• $1.4 billion for ACEP through FY26 

• • $100M in FY23; $200M for FY24; $500M for FY25; $600M for FY26 

• $1 billion for Conservation Technical Assistance 
• $300 million for NRCS to measure outcomes associated with conservation practices (e.g., carbon sequestration, GHG reduction)