Progress 08/01/06 to 01/31/10
Outputs
OUTPUTS: This project involved a field experiment conducted between 2007 and 2010 in Cullers Run watershed in Hardy County, West Virginia. This experiment was conducted to find out how actual farmers would respond to watershed level, performance-based incentives for water quality improvements. Our experiment differed from previous performance-based payment schemes in several ways: watershed-wide payments were made to a group, rather than to individual farmers; this group determined how payments were to be allocated; payments were a function of water quantity and quality; and farmers decided what, if any, ANP abatement actions to take. Farmers were presented with a payment formula based on the quantity and quality of water flowing from the watershed. Water quality was measured based on nitrate-N (NO3-N). Researchers kept in close contact with the participating farmers and collected water quality and quantity data during the experiment. Three surveys were conducted during the project about farmer activities and attitudes. Participating farmers showed a willingness and ability to work jointly to address the issue of NO3-N runoff. They requested more detailed water quality information. Three watershed wide samplings were conducted to detect areas within the watershed that were contributing elevated levels of NO3-N. Additional intensive water quality sampling done at the behest of participating farmers, and with the cooperation of non-participating farmers, pinpointed a concentrated flow path for NO3-N runoff in the lower part of the watershed where farmland is located. The final action of this project was construction of a wetland treatment system to address this concentrated flow path for NO3-N. Canaan Valley Institute (CVI) was hired in July 2009 to design a wetland treatment system. The CVI engineer came up with an initial design which was modified based on discussions with and concerns of the landowner. This design called for a 0.2 acre wetland consisting of a lined, horizontal trench to be constructed parallel to the stream. The farmer group agreed to pursue a treatment wetland system as a solution to subsurface nitrate flows in August 2009. After more than two months of negotiations, the landowner (who was not a participating farmer in the project) agreed to allow construction of the wetland in October 2009. Farmer participants were instrumental in convincing the landowner to participate by both meeting with him and sending him letters. Construction and material bids were put out in October 2009. Two bids were received and farmer group selected the lowest bid. Construction of the treatment system occurred in November 2009 and planting the the wetland occurred during spring 2010. Presentations about research results were given at: National Water Conferences held in 2007, 2008, and 2010. The annual meeting of the Northeast Agricultural and Resource Economics Association in 2008. The annual meeting of the American Agricultural Economics Association Annual Meeting in 2008. The Virginia / West Virginia Water Research Symposium in 2007. Ecological Economics and Human Well-Being conference by the International Society for Ecological Economics in 2006. PARTICIPANTS: This project had numerous participants who contributed to its success. Participants in this project are divided into how they assisted in this project. Introductory Meetings and Farmer Recruitment: David Workman (Hardy County Extension Agent) provided support by attending and verbally supporting the project. Future Farmers of America from East Hardy H.S. provided dinners for these meetings. Ed Kesecker (NRCS District Conservationist) gave a presentation on BMP alternatives. The Mathias Ruritan Club provided a place to hold meetings. Stanly Moyer (Hardy County Commissioner) led a meeting of farmers to decide how to proceed after the project had been introduced to the farmers. During Project: Tom Basden (Nutrient Management Specialist, WVU Cooperative Extension Service) provided technical assistance on water quality improvement practices. Gretchen Cremann (Conservation Specialist, WV Conservation Agency) reviewed surveys and materials distributed to farmers. Construction of the Treatment Wetland: Canaan Valley Institute provided the design and construction oversight. Jared Beard, Resource Soil Scientist, and Dick Grey, District Conservationist, of the USDA, NRCS provided soil survey data and technical information. Project Evaluation: Deborah A. Boone, Ph.D., Agricultural Extension and Education program in the College of Agriculture, Natural Resources, and Design, West Virginia University. The most important participants were the 15 farmers and farm families who took a chance and participated during this project. Most notable was the role played by the informally recognized leader of the group, Mr. Ernie Drake. Through his perseverance and leadership, Ernie had the confidence of the other farmers required to keep the project moving forward. TARGET AUDIENCES: Audiences targeted for this research project included: environmental and agricultural economists, state agency personnel dealing with water quality, and farmers plus farm organizations. As part of this project, presentations have been made at the national water conference and annual meetings of agricultural economists. Meetings have been held with state agency personnel from the Department of Environmental Protection and the Conservation Agency in West Virginia to inform them about this project and its progress. For the local community, a presentation about the results of this project was made to the Mathias Ruritan Club in June 2009. Our goal for continuation of this project is to extend the Cullers Run watershed project to a similar type of watershed wide process for the entire Lost River watershed. This process would involve farmers, working as a group, to identify sources of NO3-N that could be addressed with targeted BMPs. PROJECT MODIFICATIONS: Lessons learned from this project included: a. When presented with performance-based payments, farmers decided to cost-share the bulk of these payments. This led to farmers being of great assistance in identification of problem areas within the entire watershed for NO3-N pollution and not just concerned about this own contributions. b. The decision to cost share group payments meant that the immediate financial incentives to individual farmers from water quality improvements were low, although actions resulting from cost-sharing may provide long term pay-offs. About one-half of the participants indicated that they joined for strictly non-monetary reasons. c. The payment formula utilized in our experiment employed water prices that were, in hindsight, too low because estimated water flow from Cullers Run prior to the experiment was too high. The payment formula resulted in monthly group payment calculations of $24 and $30 during drought conditions that occurred during the summer and fall of the first year of the experiment. Low payments were addressed in year three of the experiment by setting a minimum monthly payment at $500. d. Farmers were willing to involve other farmers outside the participating group in water quality problem solving. Their involvement was vital in convincing a non-participating landowner to allow installation of a wetland treatment system on his land. This placement of a BMP to target a concentrated flow of groundwater NO3-N into Cullers Run was possible due to the watershed wide perspective that the farmer group took for this project. e. Farmers needed assistance in information gathering and technical solutions. This assistance was provided by project researchers and government agency personnel. f. Farmers can make water quality decisions and take action to problem solve to improve water quality. Some actions only required knowledge that the farmers already had - such as fencing and reduced litter application - that were engaged by the incentives created by this project. Other actions, such as deciding upon a wetland treatment system, required additional technical assistance and appropriate data to aid in group decision-making. g. Working as a group, farmers can put forth a solution to the concentrated NO3-N groundwater flow that would have required regulatory enforcement to solve under a command and control framework. h. Water quality experts and farmers can efficiently problem solve together. Cash incentives based on water quality turned water quality information into a tool farmers could use to make additional money, rather than a threat to their livelihood. It was this dynamic - an alignment of interests - that motivated participating farmers to cooperate with water quality experts.
Impacts
Outcomes from this project included: a. Over three years of the project, a total of $16,483 was paid out in terms of performance based payments made to the farmer group. This total was much less than the $39,750 that was budgeted in the project for farmer payments. However, the remaining funds were utilized to fund the wetland treatment system. b. Farmer participants agreed to provide $6,288 in cost share funding for: (1) seed costs to plant cover crops on corn fields, and (2) to fence cattle out of a portion of the stream. c. Farmers utilized $6,195 to fund a constructed wetland treatment system built to control the concentrated NO3-N groundwater flow coming from a farm field. This field was owned by a non-participating farmer who was convinced by participating farmers to allow this system on his field. This farmer was compensated for lost productivity of the field. d. Farmers paid out $4,000 in bonus payments and equal distributions among participants. e. One farmer whose farm was located in one of largest NO3-N contributor sub-watersheds installed manure shed using NRCS cost-share assistance. f. Reported management changes among the participants included increased sale of litter outside the watershed, improved handling and application of litter, and reductions in litter application rates on agricultural land. g. Water quality improvements were observed in Cullers Run with reduced NO3-N concentrations over all three years of data collection during the project.
Publications
- Maille, P., and A. Collins. 2009. Farmers as Producers of Clean Water: A Field Experiment in Water, Agriculture and Sustainable Well-Being, Eds. U. Pascual, A. Shah, J. Bandyopadhyay. Oxford University Press: New Delhi. Pp.93-114.
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Progress 08/01/08 to 07/31/09
Outputs
OUTPUTS: This research examines lessons learned from the first 24 months of a field experiment that tests an alternative to conventional government programs. This alternative pays farmers as a group based on quantity and ambient quality of water flowing from their watershed. Farmers decide what, if any, abatement action to take and how to allocate payments among themselves. Two research questions are examined: 1) Can a watershed payment formula account for background levels of pollution; and 2) Does the watershed payment formula and institutional framework created during this field experiment elicit desired participation and abatement responses from farmers The first research question was addressed with regressions of ex ante data simulations. Results showed that a ratio of n-N loading (index watershed/experimental watershed) did eliminate the influence of background pollution levels related to discharge. However, when using data generated during the field experiment, watershed discharge was found to influence both n-N loading and observed ratios. The extreme drought conditions observed during the experiment were attributed as the primary cause of these findings. Examining question three, 53% of farmer households in the watershed participated during the first year of the field experiment. Participating farmers rent or own approximately 36% of the agricultural land in the watershed. A probit analysis of the farmer participation found that education level increases the likelihood of participation, and that farmers who are cultivated "prime" farmland participated at lower rates. This decrease was attributed to farmer perceptions that their participation in this field experiment would inject additional uncertainty into their farm income. Given that "prime" farmland in the experimental watershed has been identified as a high n-N runoff area, a key gauge of successful n-N reductions in this experiment will be bringing farmers of prime farmland into the project. Group-level actions during the field experiment provided evidence that the farmers are willing and able to work jointly to address the issue of n-N runoff. The participating farmers developed an allocation scheme to distribute payments among themselves. This payment scheme included using a large portion of each monthly payment (90%) to provide cost share support to farmers who wish to adopt runoff-reducing farm practices. To date, two cost share disbursements have occurred, and one participating farmer sought government cost share support for a manure shed to reduce runoff from his farm. Surveys of participating farmers indicate that some group mechanisms like peer monitoring and information sharing are occurring. Contrary to observations in the literature, farmers in this field experiment demonstrated the ability to develop and to implement their own abatement practices. Results of this research have been disseminated by presentations national and regional conferences, publications, and websites (http://www.cacaponinstitute.org/wvunri.htm plus http://www2.gsu.edu/~wwwcec/special/ci/index.html). PARTICIPANTS: Canaan Valley Institute was involved to design a wetland treatment system for nitrates to address a nitrate flow from groundwater that was discovered as part of farmer initiated problem solving for non-point pollution. Dr. Debby Boone of the Agricultural and Extension Education Program at West Virginia University was hired to assess participants' attitudes and perceptions about the group organization aspect of farmers working together as a group. TARGET AUDIENCES: Not relevant to this project. PROJECT MODIFICATIONS: See participants box for descriptions.
Impacts
Thus far, participating farmers have shown a willingness and ability to work jointly to address the issue of n-N runoff. In order to appropriately problem solve, participating farmers have requested detailed water quality information. Three watershed wide samplings were conducted to detect areas within the watershed that were contributing elevated levels of n-N. Intensive water quality sampling done at the behest of participating farmers, and with the cooperation of nonparticipating farmers, has pinpointed a concentrated flow path for n-N runoff in the prime farmland area. In the case of Cullers Run, a groundwater flow, running parallel to the stream, has been identified as an important delivery source for nitrate nitrogen (n-N) into Cullers Run. Test wells were set up to pinpoint possible n-N sources so that targeted conservation practices can be undertaken. Essentially, this problem solving approach has converted an exclusively non-point problem into a combination of non-point and point problems. A wetland treatment system for n-N has been designed to address this groundwater flow problem. The farmer group is working with the landowner to install this treatment system. A summary of payments and farmer actions to date is presented below. a. Through the first 24 months of the experiment, group payments have totaled $10,953. b. Pay outs have totaled $4,279 with an additional $2,536 committed to cost share and not yet spent. c. Farmer participants agreed to provide $5,464 in cost share funding for: (1) seed costs to plant of cover crop on corn fields, and (2) to fence cattle out of a portion of the stream. d. One farmer whose farm is located in one of largest n-N contributor sub-watersheds installed a manure shed. e. Reported management changes include sale of litter outside the watershed, improved handling and application of litter, and reductions in litter application rates on agricultural land.
Publications
- Maille, P., A. Collins, and N. Gillies. 2009. Performance-based Payments for Water Quality: Experiences from a Field Experiment. Journal of Soil and Water Conversation. 64(3):85-87.
- Maille, P., and A. Collins. 2009. Performance-Based Payments for Conservation: Experience from a Water Quality Field Test with Farmers. VDM Verlag Dr. Muller: Saarbrucken, Germany.
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Progress 08/01/07 to 07/31/08
Outputs
OUTPUTS: This research project involves a group of farmers in Cullers Run watershed in Hardy County West Virginia. This project provides group payments to farmer participants. These payments are based on the quantity and quality of water flowing from the watershed. Project sign-up began 4/1/2007. Since this date, key actions undertaken by the project included: (a) Fifteen farmers signed agreements to participate in the first year of the project. These farmers account for approximately 43% of the agricultural land in Cullers Run watershed. All but one of the fifteen farmers has signed up to participate in year two starting in April 2008.(b) Farmers designed a method to allocate group payments among themselves. This method calls for a $50 sign-up bonus and 90% of each monthly payment to be set aside for eventual cost-sharing of nitrate-N reduction activities or group distribution. The remaining 10% accumulates into an account and is distributed equally to each participant when individual shares equal at least $25. (c) The first monthly payment was made in May 2007, based on water quantity and quality in April. Over 12 months of the first year, a total of $5,629.94 was paid out to the group of participating farmers. Farmers distributed $951 among themselves with most receiving $67. At the end of July 2008, the group account balance was $5,311.98, of which $2,536 is currently committed to cost share activities. (d) To ensure payments were calculated based on sound information, a stream flow gauge was installed in Cullers Run. This gauge provides estimates of the quantity of water produced by Cullers Run each month. In addition, water quality (nitrate-N concentration) is monitored in the middle and at the end of every month. These measurements form the basis for the quality element of the monthly payment formula. (e) A project website is available (http://www.cacaponinstitute.org/wvunri.htm). In September 2007, a private page for group participants was incorporated into the site. (f) A farmer survey was administered in June and July of 2008. This survey included personal interviews with 13 of the 15 farmers participating in the project, four non-participating Cullers Run farmers, and nine people farming outside the watershed. (g) Five project meetings were held with farmer participants. These meetings enabled project investigators to monitor the payment allocation scheme and distribution of funds from the group account along with setting up an approach for evaluating cost-sharing proposals to the group. One meeting was to present the results of the watershed intensive water quality sampling. At another meeting, WVU Cooperative Extension Nutrient Management Specialist Tom Basden gave a presentation on alternative approaches to assessing crop nitrogen needs. We also held one open meeting to have one-on-one discussions with participating farmers. PARTICIPANTS: Partner organizations include the Cacapon Institute, the West Virginia Department of Agriculture, the West Virginia Conservation Agency, and the Natural Resource Conservation Service. Contact organizations include the Performance-based Environmental Policies for Agriculture Initiative at the University of Vermont and the Katoomba group. Project presentations were made at the Virginia / West Virginia Water Research Symposium and annual meetings of the USDA-CSREES National Water Conference, Northeast Agricultural and Resource Economics Association, and American Agricultural Economics Association. TARGET AUDIENCES: Not relevant to this project. PROJECT MODIFICATIONS: A third year was added to the field experiment so that participants have more time to address nitrate-N abatement and receive rewards for their efforts.
Impacts
Project participants have taken an active role in examining how to address nitrate-N concentrations in Cullers Run. Two intensive watershed wide water quality sampling runs were conducted at the request of participants. These sampling runs were designed to help farmers determine sources of nitrate-N within the watershed. In response to the first intensive water quality sampling, one farmer acquired NRCS cost share support for a combination feeding/manure shed that was completed in summer 2008. The group of participating farmers met on 5/14/2008 to approve using the funds received from this project to cost share two projects to improve water quality - paying for seed of a cover crop and a 75% cost-share of fencing and watering to exclude cattle access in one pasture along Cullers Run.
Publications
- Maille, P., and A. Collins. 2008. Farmers as Producers of Clean Water: A Field Experiment, in Water, Agriculture and Sustainable Well-being, Eds. U. Pascual, A. Shah, J. Bandyopadhyay. Oxford University Press: Delhi, India.
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Progress 08/01/06 to 07/31/07
Outputs
This research will examine farmer responses to water quality issues when conservation efforts are converted from an economic cost into an economic opportunity. This research will address whether a conservation strategy can be developed to enhance the economic well-being of the conservers, those people who typically bear the costs of conservation. The primary goal of this project is to assess performance-based economic incentives to improve the quantity and quality of water flowing from a small watershed in Hardy County, West Virginia. Specific objectives are: (1) Derive and assess a pricing formula based on water quantity and quality that provides an appropriate incentive for farmers to implement best management practices (BMPs) to conserve stream water resources; (2) Given the availability of incentive payments, assess changes in farmer attitudes and behavior towards BMPs that protect and conserve water resources relative to the traditional cost share approach; (3)
Monitor changes in water quality and quantity in response to performance-based economic incentives and compare to monitoring in other watersheds where these incentives are not offered; and (4) Compare the cost effectiveness of water quality improvements for incentive payments relative to the traditional cost share approach. Water prices along with theoretical and institutional frameworks have been developed to implement performance-based incentives. Initial water quality data has been collected and simulations of watershed payments have been completed using existing data. A list of agricultural landowners and renters in the watershed has been developed for invitation to participate. The research project has been introduced to the community and initial meetings have been set for February and March 2007. Farmers were able to sign a written contract to participate in the project beginning 1 April 2007. To date, a total of fourteen farm households have signed a contract. As a group,
participating farmers have made two important decisions: (1) allocation of watershed payments; and (2) a request for a watershed-wide sampling to ascertain sources of nitrate-N. The results of the watershed-wide nitrate-N sampling were presented to farmers at a June 2007 meeting. These results agreed with prior water quality data that showed the majority of nitrate-N originated from the lower section of the watershed. We are encouraged with the sign-up results to date. One-third of the land in the watershed and about one half of farmers attending the meetings are participating in the experiment. Payments for water quantity and quality are being made to farmers based on a payment allocation scheme that they developed and approved. The water quality sampling of the watershed has already led to one farmer initiating NPSP abatement. To facilitate information sharing between researchers and farmers, we have a project website. To date, no group decision has occurred with respect to cost
sharing from project funds for NPSP abatement. We expect this to be the next significant action by the participants in this project.
Impacts
This research will demonstrate whether performance-based economic incentives offer a potentially useful tool for downstream users of surface water (like municipal governments) to utilize in order to insure upstream maintenance/improvement of water quality.
Publications
- Maille, P. and A. Collins. 2008. Farmers as producers of clean water: A field experiment, in Water and Agriculture, ed. U. Pascual, J. Bandyopadhyay and A. Shah. Oxford University Press: Oxford.
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