Environmental Services Markets Language in Farm Bill 2008

There are other sections of the Farm Bill that relate to environmental markets, but this specific section gives USDA the authority to create standards for environmental service markets.

Link to Public Law version 6124 of the Farm Bill (use CTRL-F to look for "Sec. 2709")
Link to USDA's home page for the 2008 Farm Bill

SEC. 2709. ENVIRONMENTAL SERVICES MARKETS.

Subtitle E of title XII of the Food Security Act of 1985 is amended
by inserting after section 1244 (16 U.S.C. 3844) the following new
section:

``SEC. 1245. ENVIRONMENTAL SERVICES MARKETS.

``(a) Technical Guidelines Required.--The Secretary shall establish
technical guidelines that outline science-based methods to measure the
environmental services benefits from conservation and land management
activities in order to facilitate the participation of farmers,
ranchers, and forest landowners in emerging environmental services
markets. The Secretary shall give priority to the establishment of
guidelines related to farmer, rancher, and forest landowner
participation in carbon markets.
``(b) Establishment.--The Secretary shall establish guidelines
under subsection (a) for use in developing the following:
``(1) A procedure to measure environmental services
benefits.
``(2) A protocol to report environmental services benefits.
``(3) A registry to collect, record and maintain the
benefits measured.
``(c) Verification Requirements.--
``(1) Verification of reports.--The Secretary shall
establish guidelines for a process to verify that a farmer,
rancher, or forest landowner who reports an environmental
services benefit pursuant to the protocol required by paragraph
(2) of subsection (b) for inclusion in the registry required by
paragraph (3) of such subsection has implemented the
conservation or land management activity covered by the report.
``(2) Role of third parties.--In establishing the
verification guidelines required by paragraph (1), the
Secretary shall consider the role of third-parties in
conducting independent verification of benefits produced for
environmental services markets and other functions, as
determined by the Secretary.
``(d) Use of Existing Information.--In carrying out subsection (b),
the Secretary shall build on activities or information in existence on
the date of the enactment of the Food, Conservation, and Energy Act of
2008 regarding environmental services markets.
``(e) Consultation.--In carrying out this section, the Secretary
shall consult with the following:
``(1) Federal and State government agencies.
``(2) Nongovernmental interests including--
``(A) farm, ranch, and forestry producers;
``(B) financial institutions involved in
environmental services trading;
``(C) institutions of higher education with
relevant expertise or experience;
``(D) nongovernmental organizations with relevant
expertise or experience; and
``(E) private sector representatives with relevant
expertise or experience.
``(3) Other interested persons, as determined by the
Secretary.''.

News Summary for 5/17-6/3

Projects
- Nonmarket Valuation – BBC World “Nature Inc.” – “a new series that reveals the true value of nature by putting a price tag on it.” 1st install – bee pollination & CA almond groves June 13th 19:30GMT.
- W Flow – new FS project looks at beavers/fens restor/reintro in Rocky Mtn region to incr w retention capacity as CC adaptation. Contact: Trey Schillie

News
- Farm Bill (USDA website)
---“Passes” (w/snafu) on 5/22 (veto overridden)
---5-yr, $307 bill - $4bill for conservation ($188mill for Ches Bay)
---Lang to help env svcs markets but no funding (“develop uniform standards for quantifying environmental services; establish credit registries; and offer credit audit and certification services”)
---New grants for buying community forests; cost share for emergency for restor; state forest assess & plans; forest “CIG”-type grant program; wood-to-NRG program
---Some, but not much reform of subsidies (see Economist slam)
---Ecosystem Marketplace summary
---Summary of forestry-related items by Northern Forest Alliance Exec Dir George Gay
---Summary of Conservation Title from American Farmland Trust

- All things Mitigation - Ecosystem Marketplace’s Mitigation Mail (5/30)
---FL bill to regulate sea grass loss/damages fine facing veto as last-min amend to allow mitigation banking angers enviros. Crit: miti = net loss
---a NJ conserve trust is putting land up for bid to dev/sell WL miti (but not own the land). Bids start at $15k. Could bring the org $3.8mill.
---TX County has HCP for review that sets up cons miti bank (birds, karst invertebrates) for roads, schools, utilities, pub or priv dev, etc. in Co.
---Charlotte County plans to buy scrub jay (TES) habitat crit: $$, would be preserved by landowner anyway (additionality), pub access concerns
---Another Co gets crit re: additionality of cons miti plan on pub land bought for conservation. Sounds like idea to create bank spurred by dev D/ lack of miti S
---Another gov gets crit re: additionality/net loss – ME DOT + partners planned to restore WL for restoration’s sake, then decided to turn it into a WL miti bank for their uses.
---Miti industry consolidation – Wildlands Inc. buys Acer Environmental (GA/NC)
---Australia’s BioBanking has RFP for landowners to dev/sell biodiv credits, sign biobanking agree

- Cons banking/ Regulatory drivers – US House Nat Res Comm/GAO investigation finds USFWS could have “trumped science with politics” on 8 ESA [de]listing decisions (of ~200 investigated). Looks like FWS jumped the gun in delisting. Pol interference could create unnaturally weak demand-driver for cons banking. House Nat Res Comm site, GAO report (70p), News article summarizing GAO official’s testimony to the House Nat Res Committee

- WQT – Ecosystem Marketplace article on Vol W Mkts reviews basics of D drivers (even if “vol”, gotta have reg driver)/players (regulated PT source, unreg ag sector) in WQT; ag prefers to stay under the radar of regulation/gov (eg – verifiers on farms); WQT price must entice - no D if ag prices high; state policies can work against D (ex – MD “flush tax” paying for PT source poll reduction).

- C – PG&E RFP asks for up to 1mill tons GHG emiss reduction via CA CCAR-verified projects to use customers’ vol offset $s. Deadline 7/2.
- C tax – SF Bay air qual mngt auth 1st in US to charge businesses fees to emit GHG. Will raise $1.1mill from 2500 businesses (ex fees: ~$1/yr for service station -> $50k+/yr for oil refinery). [Q: and do what with it?]
- REDD – New Forests continues S Asia roll (orangutan miti in Malaysia, selling biodiv credits to palm oil manu in Borneo) w/ REDD arrange w/ Indonesia regional gov for up to 1mill hectares forest.
- REDD in the USA – NPR story on N CA forest mngd by Pac For Trust –old trees capture/store > C > quickly than younger trees; variable standards of vol C offsets; CCAR

- Nonmarket valuation –U MD Center for Agroecology study on multi ecosys svcs, incl: maximizing forest mngt for C seq & timber, recre values ($96/day trip, $400/overnight trip), existence value of forests ($200-$375/person/yr). Press release, News story
- Nonmarket val – EU/Germany report: world env damage and species loss from forests costs $2.1-$4.8 trill/yr (NPV). Other world-scale val studies in draft stage: gen biodiv loss, coral reefs, Meditterr coastal WL, env bene of flood/erosion risk mngt, cost of species/hab plans.
- Nonmarket val – Tufts U/NRDC research – cost of not addressing CC (esp from hurri damages, real est loss, incr NRG costs, w costs) in US is $3.8trill/yr by 2100.
- Nonmarket val – CA Forest Assoc’s summer mag is all about link betw forest -> clean water/ consistent flow, W & CC, etc.

- Certif – FSC Fam Forest Cert mtg ID’d ways 2 reduce costs assoc w/ cert, incr landowner bene, impr communic. Mtg report soon.

- Tools – NWI maps now on Google Earth
- Tools – Forestry GIS freeware

-Misc – OSU article on forest mkt drivers - TIMOs and REITs don’t care about maximizing ecosys svcs, sustaining local econ, etc. Land goes to highest val (golf course, timber, whatever). Rise of TIMOs/REITS b/c of tax law (disadvan for timber co’s to own land).

Farm Bill... could've been so much better

The 5-year, $307 billion Farm Bill was passed on May 22nd (vetoed and overridden). Here's what Ecosystem Marketplace says about the bill:

The action has direct and indirect effects on environmental markets – for not only does the new Farm Bill govern large swathes of the ecosystem marketplace, but the relatively small portion of its funding earmarked for conservation [$4 billion] still represents the federal government's largest environmental outlay...

The new Act calls for the agricultural secretary to: "establish technical guidelines that outline science-based methods to measure the environmental services benefits from conservation and land management activities."

The guidelines are to be used to develop procedures for measuring environmental services benefits, a protocol for reporting them, and a registry. Guidelines to help farmers, ranchers, and forest landowners participate in carbon markets are a priority – but the bill provides no funding for the initiative. [emphasis added]

Both Ecosystem Marketplace and The Economist note that the real loss in this Farm Bill is the lack of reform of commodity subsidies. The Economist slams the Bill as one giant income distribution mechanism, funneling tax dollars to rich farmers (average income: $230,000)

Here'a a summary of the conservation title, courtesy of American Farmland Trust