How to Successfully Implement Cover Crop Requirements in Public Leases
Increasing rates of cover crop use on rented ground is the next frontier in improving water quality, promoting soil health and improving farmers’ resilience and not all of this rented land is privately owned. Local, state, and federal agencies own a large amount of land in the U.S. for the purpose of protecting natural resources and providing public infrastructure (flood management, water quality management, etc).
There are three main public agencies that own and rent farm land in Iowa: The Iowa Department of Natural Resources (DNR), the United States Army and the Army Corps of Engineers. For the DNR particularly, renting out this agricultural land is a balancing act between making sure that land is productive and creating and protecting wildlife habitat. The use of cover crops between cash crops on public rented ground addresses both of these goals. Cover crops are planted to coincide with maturity of commodity crops like corn or soybeans and protect the soil until a new cash crop is planted in the spring so that there are living roots in the ground at nearly all times. This protects natural resources like water and soil by preventing erosion and nutrient leaching, and it provides and/or improves habitat for both aquatic and terrestrial species (see Wilcoxen et al. 2017).
Despite the natural overlap between the goals of public agencies like DNR and the outcomes of cover cropping, it is still rarely implemented on their rented land. We spoke with land managers at several public agencies to better understand the barriers and opportunities for implementing cover crops on public lands. The following blog outlines three case studies where public land managers have added cover crop requirements in their leases and we conclude with some lessons learned that could help other public land managers implement cover crops on their acres. We found that the elements of a successful lease are: a cover crop requirement, basic best management safeguards and a penalty if cover crop is not established. To effectively manage these leases, land managers also require easier access to quality information about cover crops and should leverage public support for cover crops in their county.
Army – Middletown, Iowa
The Army owns 20,000 acres in Des Moines County where it operates a munitions plant near Middletown, Iowa. In 2017, just over 1,000 acres of land suitable for row crop production was leased to farmers on leases for one, two or five years. Since 2015, a stipulation of these leases was that cover crops had to be used, motivated largely by the Army land manager’s own interest in the benefits of cover crops. The exact language from the lease used at the Middletown plant is located in Section five of the Agricultural Land Use Regulations and Special Conditions (p. 26). It states:
This language includes several key factors to ensure both compliance with the cover crop requirements and a successful cover crop establishment. To the first point, the lease contains explicit language about a monetary penalty for failing to establish a cover crop. The penalty payment is strategically set at $60, higher than the $40-50 per acre cost to install cover crops. This provides an incentive to the manager to pursue the cover crops as the more cost-effective option.
To ensure that the cover crop is successfully established, the lease takes one step further with some guidelines on cover crop management and planting. Notice that if the cover crop is drilled, the lease suggests the tenant should plant cover crops on the same day as row crop harvest – a best practice to ensure maximum heat units and cover crop growth before the winter dormancy period. The lease prohibits fall tillage; safeguarding the benefits of leaving cover crops growing or their winter kill residue on the fields through the winter and spring protecting the soil from erosion and holding nutrients in the plant tissue. Another stipulation requires the farmer to consult with the IAAAP Agronomist on cover crop rates and varieties so they have some expert guidance to develop a successful strategy. These clauses not only maximize the environmental benefits of cover crops, but also support the farmer in managing these tools in their production system.
DNR – Ringgold County
After the DNR committed to cover cropping 100% of their row crop leases in 2014, DNR staff in Southwest Iowa have been pioneers in taking on the challenge of implementing the mandate. Because the DNR leases in this part of Iowa tend to be larger, continuous acreages, it made it an ideal place to pilot cover crop requirements in leases. Provision 13 of the addendum to a lease for 160 acres of row crops in Ringgold County for 2016-2020 reads:
The requirement is simple, straightforward. So far, it has been well received, with only one case of a farmer simply not following the requirement. Rather than have a penalty tied directly to the cover crop provision, the following clause applies to all of the items in the addendum:
While this allows the agent to dismiss the tenant at any time during the four year lease, it doesn’t provide the DNR manager with many options for encouraging compliance with the cover crop requirement. The risk of dismissing a tenant mid-lease and being unable to find a replacement is a serious consideration for land managers. Having an intermediate, financial consequence diversifies the tools that land managers have to encourage behavior change even within a set lease period and offers a lower-risk option to address non-compliance rather than terminating the lease.
One approach taken by Josh Rusk, the DNR land manager for the Ringgold lease, has been to work with Natural Resource Conservation Service (NRCS) or Iowa Department of Agriculture and Land Stewardship (IDALS) to cover the costs of implementing cover crops for the farmers. The farmer applies for cost share through their county NRCS or IDALS office and receives technical advice there on how to plant and manage cover crops. If necessary, Josh says, “I will take the extra cost of doing cover crops into account when setting the rental rate. We’re not in it for the money; we’re in it for the management, so I have this flexibility.”
An additional benefit of working with NRCS is that planting date requirements and prohibitions against fall tillage are enforced through the cost share. These management aspects are thus not required in the DNR lease, but many leases, like the Ringgold example, include prohibitions against fall tillage in addition to the NRCS restrictions. It is a best practice to include basic management safeguards like planting date guidelines or prohibitions on fall tillage after cover crop establishment, even if they are encouraging tenants to work with the NRCS, so that basic best management practices are secured regardless of the tenant’s use of other cost-share programs.
DNR – Badger Creek, Madison County
Andy Kellner manages DNR land in Madison and Adair counties and, like Josh, has gotten creative with how to implement cover crops with his tenants. His work with his tenant on the Badger Creek Watershed in Madison County is an example of how land managers can start implementing cover crops with their tenants even if they’re in the middle of a lease.
When the DNR started encouraging land managers to include cover crop requirements in their leases, Andy had just signed a five year lease with his tenant for the Badger Creek land. Rather than wait for five years to take action, Andy started having conversations with his farmer. “The farmer was nervous about the money he was putting into it because it’s not his property and doesn’t have a guaranteed lease forever,” Andy says. “So I worked with the NRCS to get the cost share and then committed with the farmer to take any remaining cost off of the rental rate.” The Badger Creek Park is on state land and because the lake is on the impaired water list, the area is eligible for Environmental Quality Incentives Program and federal Water Quality Initiative money. Andy worked closely with Anna McDonald, the watershed project coordinator for the Badger Creek Lake Watershed Project, to identify and enroll his tenant in cost-share opportunities. So far, cost share has covered all of the costs for his tenants so he hasn’t had to lower rental rates at all.
“As soon as you get over the price barrier to let them know that there are price programs and lease negotiation possibilities,” Andy says, “then it’s a positive conversation because they’re curious – it gives them a no-risk trial. And hopefully we can be a good example for neighbors.” So until the lease comes up for renewal, Andy has a verbal agreement with his tenant to plant cover crops built on the strength of their relationship.
For land managers who don’t have a rock star like Anna driving the process to connect farmers with cost-share and information on how to successfully manage cover crops, locating the tools to implement cover crops can be a barrier. “We do find that we share a lot of goals with the farmers when it comes to conservation,” Andy says. “It’s just a matter of providing or connecting them to the right resources to get it done.”
In talking with DNR land managers, a surprising barrier they identified to putting cover crops into leases was the beginning farmer requirements for public ag leases. In 2013, the Iowa legislature passed a mandate that DNR leases had to be given preferentially to beginning farmers to increase land access for those starting out. In 2017, any farmer with a net worth of less than $645,284 qualifies for preferential access to DNR leases under this policy. Therefore a small farmer who has been farming for fifty years but comes in below the net worth threshold because of special accounting practices or agricultural management qualifies alongside a farmer in their fourth or fifth season who hasn’t amassed large assets yet. In Josh’s words, “With beginning farmers, they’re pretty receptive to doing new practices. It’s the old timers that have more of a problem adapting to new practices.” In DNR staff’s experience, the current policy brings in both of these groups of farmers for preferential treatment.
A second issue with the beginning farmer policy is that it requires all DNR contracts to be posted to a public forum for a certain period to allow beginning farmers to apply for them. Previously, DNR land managers had the option to continue to offer the current tenant a renewed lease without posting it to the public forum if the rent was under $5,000 per year. The change is problematic for cover crop goals because it exacerbates the inherent tension in implementing long-term conservation measures on short-term leases. If a farmer only has a two year lease then they will do most of the work for cover crops but not reap the benefits of building soil health in the term of their lease. This is then further compounded by uncertainty around whether or not they will be able to renew their lease on that ground, so there is no business case for caring for the rented land as a long-term investment; current legislation requires that preference be given to beginning farmers who have not participated in the program over a beginning farmer in a position to renew their lease (House File 457, Section 1.7).
Typically, one strategy for creating a conducive environment for cover crops on rented ground is to increase lease (and thus relationship) lengths so both parties have a long-term stake in its management. Working within a structure where long-term relationships are off of the table, DNR land managers like Andy and Josh have turned to agreements that cover the up-front costs of cover crops through leveraged state and federal money to make sure that these practices can fit in their tenants’ business interests.
From these case studies and others we were able to identify the following elements of effective cover crop lease requirements:
- A cover crop requirement in the lease with absolute language;
- Best management guideline such as event date (plant cover crop same day as harvest, before November 1, etc.) to promote cover crop establishment or prohibition on fall tillage after establishment;
- Penalty for noncompliance (lease termination or additional charges).
Our interviews with staff from several different public agencies within and outside of Iowa indicated that comfort with cover crops among the staff who manage land resources is often a key barrier or opportunity to implementing cover crop requirements. Knowing some basics about the best management practices for cover crops can go a long way to helping land managers write leases and interact and answer farmers’ questions about the lease requirements. We saw in the Ringgold and Badger Creek case studies that the land manager relied on NRCS or Watershed Coordinators to provide a lot of this technical information. Land managers can use this watershed project website to identify if there is a watershed project in their area and this IDALS website to find contact information for each of the county SWCD offices where the watershed coordinators are housed. These offices also deal with state and federal cost-share programs, so they are a one-stop-shop for farmers seeking cover crop assistance.
To address this knowledge gap among DNR staff, the DNR may consider setting up a state-wide cover crop training event or several regional events for land managers led by experts like Practical Farmers of Iowa or NRCS, allowing land managers to attend cover crop field days on work time or developing a mentor network for land managers to interact with their peers who have already started working with farmers to implement the cover crop requirements. Any or some combination of these options would help land managers expand their knowledge and confidence on cover crops, allowing them to tackle adding cover crop requirements to their own leases head on.
Public agencies that own and lease farmland have an enormous opportunity to implement conservation practices that provide public goods as a model for other farmers and landowners. These conservation practices not only promote clean water and improved soil health, but also work towards goals such as creating wildlife friendly spaces, a central component of the DNR’s mission. The case studies presented here provide blueprints for other DNR and public agencies in Iowa to incorporate cover crop requirement language into their leases. Land managers should attend cover crop field days in their area or seek out educational materials online about cover crops to equip themselves with basic information to begin conversations with their renters.
With these next steps, the DNR and other public agencies in Iowa can create successful cover crop practices that both fit in the business and production plan of the farmer and satisfy the stewardship goals of the public agency.