Ecosystem Services 47 (2021) 101223

Contents lists available at ScienceDirect

Ecosystem Services
journal homepage: www.elsevier.com/locate/ecoser

A mixed-methods analysis for improving farmer participation in

agri-environmental payments for ecosystem services in Vermont, USA
Gemma Del Rossi a, c, *, Jory S. Hecht b, Asim Zia a, b, d
a
Department of Community Development & Applied Economics, Morrill Hall, University of Vermont Burlington Vermont, 05405, United States
b
VT EPSCoR, University of Vermont, 23 Mansfield Ave Burlington Vermont, 05401, United States
c
Department of Animal & Veterinary Science, University of Vermont, 570 Main Street Burlington Vermont, 05405, United States
d
Gund Institute for Environment, University of Vermont, Farrell Hall, 210 Colchester Ave Burlington, Vermont 05405, United States

A R T I C L E I N F O A B S T R A C T

Keywords: We examine whether using a payment for ecosystem services (PES) framework for agri-environmental programs
Payment for Ecosystem Services (PES) could increase farmer participation through a mixed methods approach. We assess the institutional design of two
Governance of PES programs U.S. agri-environmental programs, the Environmental Quality Incentives Program (EQIP) and the Conservation
Institutional design
Reserve Enhancement Program (CREP), in the Lake Champlain Basin in the northeastern US, where managing
Farmer participation
Agriculture-water quality trade-offs
eutrophication from phosphorus pollution remains a challenge. We synthesize a checklist of institutional markers
Agri-environmental programs previously derived from past PES literature and assess the extent to which these two programs increase partic­
ipation and achieve environmental goals. Our analysis demonstrates EQIP and CREP meet several PES principles.
However, transaction costs present a barrier towards participation with both programs. We suggest these costs
can be lowered by greater technical assistance. We categorize EQIP program data by their ecosystem service
provision using the Millennium Ecosystem Assessment classification. We find EQIP demonstrates cost-effective
targeting and conditionality yet may have an institutional focus on large-scale structural practices focused on
“end of pipe” prevention of nutrient runoff. The positive effect that PES institutional design criteria have on
participation in agri-environmental incentive programs motivates further research on synergies and tradeoffs
between farmer participation and environmental outcomes.

1. Introduction Prokopy, 2014; Khanna & Ando, 2009).

In recent decades, a tradeoff between agricultural production and
ecosystem services (ES) has emerged due to increasing global population
and consumption of natural resources, enhanced agricultural produc­
tivity, and ecosystem degradation. These valuable ES include clean
drinking water, carbon dioxide regulation, pollination, pollution con­
trol, aquatic habitat and biodiversity, and recreational and aesthetic
benefits (Millennium Ecosystem Assessment (MEA), 2005). To combat
ecosystem degradation due to agriculture, a variety of agri-
environmental programs (AEPs) have been implemented globally to
incentivize environmentally beneficial agricultural practices and pre­
serve ES. Through AEPs, farmers receive financial incentives for
conservation-oriented and environmentally beneficial practices, while
still producing food and other income-generating crops. However,
strategies for the successful implementation of AEPs remain unclear, and
farmer participation varies greatly from program to program (Reimer &
Many AEPs are also classified as Payment for Ecosystem Services
(PES) programs, defined as, “voluntary transactions where a well-
defined environmental service (or a land use) is ‘bought’ by a service
buyer from a service provider” (Wunder, 2005, p. 3). This definition of
PES largely comes from the Coase Theorem, where externalities (nega­
tive or positive) can be corrected through negotiation or private markets
(Vatn, 2010; Engel et al., 2008). In recent years, the Pigouvian nature of
institution-directed PES has become increasingly recognized (Vatn,
2010). Pigouvian PES seek to correct market externalities through the
implementation of a tax or subsidy (Vatn, 2010; Sattler et al., 2013;
Wunder, 2015). Broadly, AEPs with incentive-based structures fall
under the Pigouvian framework and are thus considered PES (Sattler
et al., 2013). Following this framing, we evaluate two U.S. AEPs, the
Environmental Quality Incentives Program (EQIP) and the Conservation
Reserve Enhancement Program (CREP), as PES programs.
Often, a PES program’s success is based on participant adoption and

* Corresponding author at: 114 Schuyler Place, Ithaca, New York 14850, United States.
E-mail addresses: gld42@cornell.edu (G. Del Rossi), jhecht@usgs.gov (J.S. Hecht), azia@uvm.edu (A. Zia).

https://doi.org/10.1016/j.ecoser.2020.101223
Received 4 May 2019; Received in revised form 2 November 2020; Accepted 3 November 2020
Available online 21 December 2020
2212-0416/© 2020 Elsevier B.V. All rights reserved.
G. Del Rossi et al. Ecosystem Services 47 (2021) 101223

implementation. Low enrollment in PES schemes has been a trouble­ Zanella et al., 2014; Bremer et al., 2014; Christensen et al., 2011).
some aspect for those who are concerned that limited participation may Table 1 summarizes the literature on which institutional rules and
fail to bring about the desired ES and environmental improvements. structures, or “checkpoints,” can help to increase program participation
However, Engel (2016) remarks, “maximizing ES providers’ willingness or ease barriers of adoption. Further, we evaluate EQIP and CREP’s
to participate in a PES scheme is not equivalent to PES effectiveness” (p. institutional design based upon these identified checkpoints.
139). Yet for certain ES requiring community- or regional-scale coop­ We apply a mixed-methods approach to evaluate participation in
eration, such as payments for watershed services (Muñoz Escobar et al., EQIP and CREP as PES and determine where they succeed and fail in
2013; Mettepenningen et al., 2013), participation must be high enough meeting the identified checkpoints using legal document analysis,
for the program to be effective. Understanding what drives participants analysis of program data (n = 11,364), and semi-structured interviews
to adopt PES programs is a complex task, as there are cultural, financial, with farmers and agency personnel. In addition, to the best of our
institutional, and socio-economic aspects that can affect program knowledge, this is the first paper to evaluate participation in EQIP and
adoption. CREP by examining their institutional design as a PES scheme. Our study
Prior studies have shown financial incentives can encourage farmer offers a template for evaluating participation in agriculturally based
participation in these programs, especially when they cover the farmer’s programs whose objectives may not solely be focused on improving ES,
opportunity cost of adoption (Chen et al., 2009; Zheng et al., 2013; but rather achieving broad environmental objectives at both farmstead
Christensen et al., 2011; Yin et al., 2013; Hejnowicz et al., 2014). Social and watershed scales.
networks also foment farmer participation in agri-environmental PES We determine the ways in which the institutional design of EQIP and
programs, even when financial incentives cannot fully cover farmer CREP impact participation in these programs and elicit farmer percep­
opportunity costs (Schomers et al., 2015; Kosoy et al., 2007, 2008; tions about potential improvements in the institutional designs of such
Baumgart-Getz et al., 2012). Chen et al. (2009) found re-enrollment in programs. We also evaluate how the institutional rules of EQIP and
China’s Grain to Green Program largely depends on decisions made by CREP are aligned with a PES framework better by examining these two
neighbors, program duration, economic and demographic conditions, programs in the Lake Champlain Basin (LCB) in the U.S. states of Ver­
farm features, and personal characteristics, showing how varied the mont and New York, where there is a contentious tradeoff between
factors are that drive participation in agri-environmental PES. Further phosphorus pollution and agricultural production (see EPA, 2016; Zia
drivers of PES program participation include transaction costs (Chris­ et al., 2016). While we draw our main conclusions from the imple­
tensen et al., 2011; Zanella et al., 2014; Sattler et al., 2013; Schomers & mentation of CREP and EQIP in Vermont, we also interviewed farmers
Matzdorf, 2013; Bollman & Hardy, 2011; Falconer, 2000), administra­ from the New York portion of the watershed to augment and diversify
tive complexity (Brown et al., 2019; Chapman et al., 2019; Falconer, our sample. We determine whether structuring federal
2000; Mettepenningen et al., 2013; Reimer & Prokopy, 2014), social and agri-environmental programs as successful PES schemes can improve
cultural capital (Chapman et al., 2019; Greiner & Gregg, 2011; Bremer farmer participation in EQIP and CREP while providing ES to the LCB.
et al., 2014), farm characteristics, land tenure requirements (Bremer The specific research questions guiding this study are as follows:
et al., 2014; Zanella et al., 2014; Schomers & Matzdorf, 2013), envi­
ronmental and intrinsic motivations (Chapman et al., 2019; Bremer
et al., 2014; Baumgart-Getz et al., 2012), access to information (Chris­
tensen et al., 2011; Zanella et al., 2014; Schomers et al., 2015; Hejno­
wicz et al., 2014; Kosoy et al., 2008; Mettepenningen et al., 2013), and Table 1
risk and uncertainty (Greiner & Gregg, 2011). List of institutional “checkpoints” identified from previous literature to increase
Despite the literature on international PES programs, few studies farmer participation or decrease barriers of adoption in a PES or AEP.
have evaluated U.S. based AEPs as PES programs (Schomers & Matzdorf, Checkpoint Sources
2013; Chapman et al., 2019; Sattler et al., 2013). Existing research on The use of intermediaries and technical Baumgart-Getz et al., 2012; Falconer,
EQIP and CREP has focused on farmer participation and adoption. Both assistance 2000; Hejnowicz et al., 2014; Huber-
programs have historically had low enrollment (Reimer & Prokopy, Stearns et al., 2015; Kosoy et al., 2008;
Mettepenningen et al., 2013; Sattler et al.,
2014), a challenge associated with both AEPs and PES programs
2013; Schomers et al., 2015; Vatn, 2010;
(Christensen et al., 2011; Zanella et al., 2014; Schomers et al., 2015; Yin et al., 2013
Mettepenningen et al., 2013). Conner et al. (2016) attribute low A “results oriented” method to develop Christensen et al., 2011; Engel et al.,
participation in EQIP to incentive payments being below farmers’ indicators to monitor environmental 2008; Huber-Stearns et al., 2015;
willingness-to-accept, given agricultural production opportunity costs. results Mettepenningen et al., 2013; Meyer et al.,
2015; Zanella et al., 2014
Moreover, even higher incentive payments are often necessary to Rules are simple and easy to Chapman et al., 2019; Kosoy et al., 2008;
encourage farmers to implement more complex or lesser-known prac­ understand; easy to enforce Mettepenningen et al., 2013; Muñoz
tices (Conner et al., 2016). Reimer & Prokopy (2014) highlighted other Escobar et al., 2013; Vatn, 2010
barriers to participation: lack of knowledge about programs; confusion Low transaction costs Bollman & Hardy, 2011; Christensen
et al., 2011; Falconer, 2000; Zanella et al.,
surrounding acronyms, requirements and eligibility; lack of money and
2014
time – especially for small farm operations; and the opportunity cost of Cost-effective or optimal targeting Chen et al., 2010; Claassen et al., 2001;
not keeping land in production. Reimer et al. (2013) argue farm size Mettepenningen et al., 2013; Yin et al.,
impedes enrollment in EQIP, as small farmers (with annual revenue less 2013
than $100,000) generally cannot afford the cost share required to Shorter, flexible contracts Christensen et al., 2011; Engel, 2016;
Schomers et al., 2015; Yin et al., 2013
implement practices. Chapman et al. (2019) suggest low participation in Tangible provision of an ecosystem Christensen et al., 2011; Mettepenningen
CREP is due to conflicting values between programmatic and farmers’ service (conditionality) et al., 2013; Wunder, 2005; Zanella et al.,
goals and reframing CREP to appeal to intrinsic values can increase 2014
farmer participation. Participatory design process to Kosoy et al., 2008; Prager et al., 2012;
encourage trust and cooperation of Vatn, 2010
As more PES programs are implemented globally (Schomers &
the program users
Matzdorf, 2013; Kosoy et al., 2008), researchers have examined which Financial incentive must exceed the Claassen et al., 2008; Engel et al., 2008;
institutional structures contribute to their success (Engel et al., 2008; opportunity cost of the user’s Engel, 2016; Kosoy et al., 2007
Huber-Stearns et al., 2015; Yin et al., 2013; Hejnowicz et al., 2014) and alternative land use
which institutional structures and rules can encourage or discourage
participation in PES (Mettepenningen et al., 2013; Kosoy et al., 2008;

2
G. Del Rossi et al.
Fig. 1. Map of Lake Champlain Basin, its tributaries, and the U.S. Counties/Canadian Province in which it is located.
• Do the institutional rules of EQIP and CREP increase or hinder farmer
participation in these agri-environmental incentive programs?
• What do the funding allocations and incentive distributions for EQIP
practices reveal about which institutional markers EQIP meets for
encouraging participation?
• What challenges and opportunities to improve the institutional
design and encourage participation in EQIP and CREP programs do
farmers perceive?
2. Methods
This section describes the mixed methods approach we employed to
elucidate the institutional rules associated with EQIP and CREP
contextualized by phosphorus pollution control in the LCB. Specifically,
three methods were applied: (1) legal documents relating to EQIP and
CREP were analyzed to determine the institutional rules governing
farmers in our study area; (2) EQIP program data (1996–2012) were
analyzed to determine the funding allocation and incentive distributions
of six ES-based practice categories; (3) 19 semi-structured interviews
with farmers and employees and experts from government agencies
across the watershed were conducted in 2017.
Mixed methods research (MMR) is an integrative form of research
whose goal is to “collect both narrative and numeric data, employ both
structured and emergent designs, analyze their data both via statistical
and content/meaning analysis, and integrate the results in order to reach
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Ecosystem Services 47 (2021) 101223
‘metainferences’ that integrate qualitative and quantitative findings to
provide better answers to research questions” (Tashakkori et al., 2015,
p. 619). In this study, we use an intermethod mixing approach by using
multiple methods of data collection and analysis to derive our results.
Further, using three separate research approaches allows us to trian­
gulate our results, bolstering the validity of our findings. Each method
was chosen to help address our research questions identified in Section
1. Legal document analysis will elucidate the institutional rules gov­
erning EQIP and CREP; statistical data analysis of EQIP’s funding and
incentive payments will reveal which types of practices are most
commonly implemented; and semi-structured interviews allow for un­
derstanding the range of farmer perceptions and participation regarding
EQIP and CREP. The semi-structured interviews also provide an op­
portunity to examine whether participant recommendations for pro­
gram improvements align with PES principles. By employing these three
methods, we triangulate which checkpoints identified in Table 1 are met
and draw conclusions about how the institutional design of these pro­
grams aids or hinders participation.
2.1. Case study: Lake Champlain Basin
The study region is concentrated within the transboundary Lake
Champlain Basin (LCB), which spans the U.S. states of Vermont and New
York, as well as the Canadian province of Quebec (Fig. 1). Although Lake
Champlain is only 1127 km2, its contributing watershed covers 21,326
G. Del Rossi et al.
km2 (Lake Champlain Basin Program (LCBP), 2017). Given this high
watershed to lake area ratio, activities conducted on the basin landscape
have a greater impact on lake water quality than the contributing wa­
tersheds of many other lakes (LCBP, 2018). In recent decades, tradeoffs
between agricultural production and phosphorus pollution have become
quite contentious (Zia et al., 2016). Vermont comprises over half of the
LCB watershed (56%), and its agricultural sector contributes 38% - the
highest of all loading sources - of the total phosphorus load into Lake
Champlain, showing the outsized impact it can have on water quality
(LCBP, 2018). For this reason, we focus our study on Vermont.
In 2002, nine out of 12 Vermont segments of Lake Champlain were
issued Total Maximum Daily Load (TMDL) requirements due to high
phosphorus loads from Vermont tributary basins (56% of the basin land
area (LCBP, 2017)). These loads were triggering large harmful blue-
green algae (cyanobacteria) blooms (U.S. Environmental Protection
Agency (EPA), 2002). In 2008, the EPA disapproved the Vermont
portion of the TMDL, forcing Vermont to institute a new TMDL in 2016
(U.S. EPA, 2016). However, concerns about lake water quality remain
due to ongoing land development, the gradual implementation of
mandated nutrient management measures, and the projected aggrava­
tion of cyanobacteria blooms under future climate scenarios (Zia et al.,
2016).
2.2. Regulatory framework and legal document analysis
EQIP was created under the Natural Resources Conservation Service
(NRCS) of United States Department of Agriculture (USDA) in 1995 with
the goal of encouraging practices that improve environmental benefits,
from working agricultural lands (Ross & Rupe, 2016; NRCS Vermont,
2017). EQIP is a voluntary conservation program in which farmers
create conservation plans and compete for financial assistance from
pools of funding allocated from the US Farm Bill and distributed to state
agencies (Ross & Rupe, 2016; NRCS Vermont, 2017; Claassen et al.,
2001). EQIP funds the conservation plans that best meet program goals
of promoting agricultural production, forest management, and envi­
ronmental quality in the most cost-effective manner through a
competitive ranking system. The specific funding pools are annually
identified and allocated funding in conjunction with the NRCS and State
Technical Committees to determine which conservation plans best meet
the outlined management goals. EQIP funds up to 75% of practice costs
based on regional cost estimates. The conservation plans meeting na­
tional and state environmental priorities in the most cost-effective
manner are selected (NRCS Vermont, 2017; Krueger, 2007; Claassen
et al., 2001). EQIP is a well-established program within Vermont. Ac­
cording to our program data, there were 71,388 ha of land enrolled in
EQIP in Vermont, or 14.3% of all agricultural land in the state. The
counties with the most area enrolled in EQIP are Franklin (10,707 ha),
Addison (8729 ha), and Rutland (8601 ha), all of which are situated in
the LCB (Appendix A).
CREP is a subsection of the Conservation Reserve Program (CRP)
under the Farm Service Agency (FSA) of USDA that was created in 1985
(USDA Farm Service Agency, 2015). CREP is a “joint federal-state
partnership whereby a participating state may request the USDA to set
aside up to 40,500 ha in a geographical area of national and state
importance and agree to share 20% of the program costs” (Khanna &
Ando, 2009, p. 579). CREP specifically targets high-priority conserva­
tion areas or watersheds without a competitive bidding process, making
enrollment less cumbersome (Suter et al., 2008; Khanna & Ando, 2009).
CREP offers compensation for the loss of productive agricultural land,
which is calculated based on the participant’s opportunity cost of
removing land from production (Suter et al., 2008). CREP offers a 90%
cost-share for implementing riparian buffers and provides an annual
incentive payment, known as a rental rate, double that of CRP. The
overall goal of CREP’s Vermont partnership is to improve water quality,
enhance aquatic and wildlife habitat, and reduce sediment, phosphorus
and nitrogen loads into the ecosystem by removing land from
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Ecosystem Services 47 (2021) 101223
agricultural production (USDA FSA, 2015). CREP is a substantially
smaller program than EQIP, both in terms of enrollment and financial
support from the state and federal government. From 2002 to 2016,
1144 ha of land was enrolled in CREP statewide (VAAFM, 2016). While
this is a small amount of land relative to the area of the LCB, the enrolled
land lies in crucial riparian buffer zones adjacent to waterways.
To determine the institutional rules of both EQIP and CREP, we
conducted a legal document analysis of the codes and statutes of these
programs, including 7 C.F.R. § 1466, 7 C.F.R. §1410, 16 U.S.C. §§ 3801 to
3862, and the Agricultural Act of 2014 (P.L. 133–79), hereafter cited as
the 2014 Farm Bill. We obtained the documents through strategic online
searches and government databases1 containing public laws and the
Code of Federal Regulations. We coded the rules and requirements of the
programs’ goals, incentives, governance structure, and PES elements
embedded within the programs. To obtain programmatic rules and
structures, we started with a large list of regulations and the sections of
Federal Code identified when reading the legal documents, conducted
an iterative organizing process in which we grouped similar rules
together, and identified the overarching themes governing specific rules.
To see the synthesized list of institutional rules, please refer to Appendix
B.
2.3. EQIP program data analysis
To obtain insights about the financial structure of institutional rules
for EQIP, we analyzed a large dataset of practices implemented through
the program in Vermont from 1996 to 2012 (n = 11,346) using the
statistical software R (R Core Team, 2019). These data were acquired
through a Freedom of Information Act (FOIA) request provided by the
USDA. Data on the practices, acres enrolled, farmers enrolled, contract
duration, and financial incentives were extracted from “Active,” “Plan­
ned,” and “Completed” contracts. All relevant data were adjusted for
inflation and put into 2020 U.S. Dollars (USD). We focused this pro­
grammatic data analysis on EQIP, since detailed data on CREP in Ver­
mont are unavailable due to the program’s small size. Moreover, since
CREP exclusively funds the retiring of riparian land for buffers, we as­
sume their projects primarily generated water-quality regulating ES. We
grouped 116 different NRCS-certified practices implemented in Vermont
(listed in Appendix C) of the approximately 250 NRCS-certified practices
into six categories and analyzed the distributions of funding allocated to
each category along with the annual incentive, or “Practice Obligation,”
farmers receive for the practices.
One of our goals in conducting the EQIP data analysis was to
determine if the program meets institutional checkpoints, such as
conditionality, by implementing practices that provide tangible ES
benefits. To do so, we categorized our data by practices which do not
provide ES – Farmstead Practices, Technical Assistance (TA) – and those
that do. We defined Farmstead Practices as practices that did not provide
any direct environmental benefits and whose main benefit remained on
the farmstead. We defined TA as practices directly providing technical
service provider support (e.g. TA Planning) or management practices
requiring a technical service provider (e.g. Irrigation Water Manage­
ment Plan). Following the ES classification of the MEA (2005), we
categorized EQIP practices which potentially provide ES into Provi­
sioning ES, Supporting ES, and Regulating ES. Cultural ES was not
included in our analysis as there were no practices whose primary ES
provision was cultural. To draw conclusions regarding the potential
nutrient management in the LCB, we also further partitioned regulating
services into those providing downstream water quality benefits and
1
To visit the government databases used to retrieve federal regulations and
laws, use the following URLs: https://www.ecfr.gov/cgi-bin/ECFR?page
=browsehttp://uscode.house.gov/https://www.ers.usda.gov/agricultural-act
-of-2014-highlights-and-implications/https://www.gpo.gov/fdsys/pkg/BILLS-
113hr2642enr/pdf/BILLS-113hr2642enr.pdf
G. Del Rossi et al.
Fig. 2. System of EQIP practice classification based on the Millennium Ecosystem Assessment (2005).
those primarily providing other regulating services such as carbon
storage and pollinator habitat. Fig. 2 presents our categorization process
and the EQIP practices within each category.
One limitation of using the MEA ecosystem classification framework
is it does not enable ES bundling, or the provision of multiple ES
generated by one practice (Bennett et al., 2009). To combat this, we
identify the primary ES generated by implementing an EQIP practice,
while recognizing certain practices provide a host of secondary benefits
not captured in this analysis. However, we are making assumptions
regarding the benefits provided by the 116 NRCS practices, as many
have not been evaluated for their ES provision through direct moni­
toring in Vermont. Rather, we classified them by their intended purpose,
as defined by NRCS’ Field Office Technical Guides (FOTG). To see our
full categorization process and justification, please refer to Appendix C.
Finally, to draw conclusions regarding how EQIP has enabled institu­
tional criteria such as conditionality, results-oriented monitoring, and
cost-effective targeting, we computed descriptive statistics, detailed
funding allocation, and compared distributions of “Practice Obliga­
tions,” hereafter referred to as financial cost-shares, allocated to farmers
for different categories of practices during the 1996, 2002, and 2008
Farm Bills.
2.4. Semi-structured interviews
We conducted 19 semi-structured interviews in 2017 across the LCB
in Vermont and New York, including 15 interviews with farmers and 4
interviews with USDA and Vermont Agency of Agriculture, Food, and
Markets (VAAFM) agents. We surveyed a wide swath of farmers to un­
derstand the range of farmer perceptions regarding EQIP and CREP,
rather than to make quantitatively rigorous conclusions about the
participation of farmers as a monolith or to compare the tendencies of
different farmer sub-groups. Farmers were contacted in several ways for
interviews, ranging from contacting farmers’ markets coordinators
across the LCB, liaising with watershed advocacy groups, and referrals
through USDA contacts.
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Ecosystem Services 47 (2021) 101223
From our initial contacts, we used snowball sampling, or the chain
referral method, to expand our sample size. USDA employees were
contacted using online searches as well as by personal communication
with an employee of VAAFM. Interviews took place in-person or over the
phone and lasted 45–60 minutes for USDA agents and 5–50 minutes for
farmers. To see interview summary tables, please refer to Appendix D.
Our interview protocol featured several possible sequences of questions
were designed to encourage in-depth and candid responses that are often
difficult to achieve in larger-sample studies. For farmers, we first asked
about their familiarity with EQIP and/or CREP. If the farmer was un­
familiar with these programs, we asked about their motivation and
implementation of best management practices (BMPs). We then ascer­
tained participation in the programs. Farmers who were familiar with
the two programs but had not participated in either were asked addi­
tional questions about why they did not participate. Conversely, we
asked farmers who had participated in EQIP or CREP their reasons for
participating, descriptions of the enrollment process, and challenging
experiences regarding these programs. The University of Vermont IRB
declared this research exempt under rule IRB 18-0006. To see the full
interview protocol, please refer to Appendix E.
To elicit farmer perceptions and evaluate the programs’ success in
meeting our institutional checklist, we used a thematic coding process to
obtain strengths, weaknesses, and opportunities for improvement for
each program. The interviews were transcribed and coded using a
standard qualitative coding format (Creswell & Poth, 2018). Once
transcribed, open coding was employed to develop a series of initial
thematic codes. From these codes, we condensed into intermediate
themes, and then into final themes of programmatic strengths, weak­
nesses, and opportunities for improvement. These naturally reflected the
interview protocol in which we asked the interviewees their likes and
dislikes of the programs, challenges they have had with the programs,
and what they would change about the programs to make participation
more appealing. Once those final themes were identified, we developed
a new set of sub-codes to identify and categorize specific programmatic
aspects (e.g. financial cost share, TA, environmental benefits) under
G. Del Rossi et al. Ecosystem Services 47 (2021) 101223

strengths, weaknesses, and opportunities for improvement for both EQIP cover the remaining 10% of implementation costs through a partnership
and CREP. with US Fish and Wildlife (USFW) through the Partners for Fish and
Wildlife Program when building forested riparian buffers (Appendix
3. Results B.2). Therefore, CREP provides a full financial incentive, where EQIP
merely provides a financial cost-share. Moreover, CREP links payments
In Table 2, we present results derived from mixed-method triangu­ to the direct provision of ES by targeting marginal land adjacent to
lation to determine which institutional aspects of EQIP and CREP meet streams and waterways and can substantially reduce sediment or
the participation checkpoints identified from the synthesis of the pre­ nutrient loads entering these bodies of water. By only providing rental
vious literature in Table 1. The following subsections present results payments to providers who enroll specific parcels of land to generate
from the analysis of each of the three methods to determine if EQIP and water quality improvements, CREP achieves the tangible provision of
CREP do indeed meet the checkpoint criteria identified. ES, meeting the conditionality checkpoint.
EQIP and CREP both fail to meet several checkpoints in Table 2 as
shown through the legal document analysis. First, EQIP fails to have low
3.1. Legal document analysis transaction costs. While a programmatic goal is to “reduce administra­
tive burdens on producers and the cost of achieving environmental
Using the methods outlined in 2.2, we obtained the institutional rules goals,” several institutional structures revealed themselves to poten­
identified in 7 C.F.R. § 1466, 7 C.F.R. §1410, 16 U.S.C. §§ 3801 to 3862, tially counteract that goal and increase transaction costs bourne by
and the 2014 Farm Bill. Interviews with USDA and VAAFM employees producers. For example, if a producer’s operation contains a waste fa­
provide additional detail about rules governing EQIP and CREP. Since cility, they must develop and implement a Comprehensive Nutrient
CREP is a partnership between USDA and individual states, specific Management Plan (CNMPs) by the end of the EQIP contract. CNMPs are
policy and requirements are primarily determined by state offices of detailed conservation plans aimed at addressing “quality criteria to the
USDA and VAAFM. Appendix B details synthesized lists of institutional sustainable level of soil erosion and water quality for the planning unit
rules identified for EQIP and CREP. associated with the animal feeding operation,” (Natural Resources
The legal document analysis suggests both EQIP and CREP meet Conservation Service, 2020) requiring additional paperwork beyond the
several institutional checkpoints (Table 2). From an institutional EQIP contract. Further, in implementing an EQIP plan of operations, the
perspective, EQIP and CREP meet the checkpoint that rules are simple producer must describe the conservation objectives, the quantitative or
and easy to understand. EQIP specifically mandates the application qualitative goals for achieving the objectives, and the conservation
process must minimize complexity, eliminate redundancies, and reduce practices to be implemented. Moreover, the schedule for implementa­
the administrative burdens on farmers to help achieve programmatic tion must include timing, sequence, operation, and maintenance and
goals. Similarly, CREP has the broad mandate to minimize complexity, information to evaluate effectiveness of plan in achieving objectives (7
but it goes a step further than EQIP because it offers continuous C.F.R. § 1466.6). If the producer fails to meet the plan of operation
enrollment without a competitive bidding process. terms, they must pay the cost share amount back in full, with interest.
EQIP successfully meets the criteria of cost-effective targeting or The administrative burden placed upon farmers to comply with these
optimal targeting and offering shorter, flexible contracts. They are institutional rules often makes the transaction costs of participating
mandated to achieve environmental goals at the lowest cost: “The least- exceedingly high.
cost alternative practice that addresses the resource concern will be used Second, EQIP does not cover the producer’s full opportunity costs of
for contracting in the EQIP plan of operations” (Appendix B.1). Further, implementing conservation practices or alternative land uses. They are
EQIP offers a flexible contract structure, with contract durations ranging mandated to not exceed 75% of the implementation costs, and the cost-
from 1 to 10 years. CREP succeeds in covering the opportunity cost of share is based upon regional payment scenarios to allow differentiated
the user’s alternative land use due to its combined implementation payments. Third, the legal document analysis reveals CREP does not
payment and annual rental incentive. CREP covers 90% of the cost of meet the criteria of flexible, shorter contracts. CREP contract duration is
implementing riparian buffers on marginal land, and it is possible to exactly 15 years, and the contract explicitly states “The contract cannot
exceed 15 years or go under 15 years. Once the contract has expired,
Table 2 producers can enroll for another contracted 15 years” (Appendix B.2).
Mixed-method triangulation to determine which institutional aspects of EQIP
and CREP meet the participation checkpoints identified in Table 1. 3.2. Program data analysis
Checkpoint Legal EQIP Data Interview
Document Analysis Analysis Our goal in analyzing EQIP’s program data from 1996 to 2012 is to
Analysis
determine how the funding was allocated across NRCS-certified prac­
The use of intermediaries and EQIP EQIP tices, and what the cost-share distributions for individual contracts
technical assistance indicate about the attainment of participation checkpoints in Table 2.
A “results oriented” method to EQIP
develop indicators to monitor
First, we examined the allocation of the EQIP budget among the 6 cat­
environmental results. egories into which we grouped 116 NRCS-certified practices (Fig. 2) to
Rules are simple and easy to CREP; EQIP CREP see if the allocations met the institutional criteria identified in Table 1.
understand; easy to enforce Overall, practices providing ES received 86.8% of the budget, while
Low transaction costs
farmstead and TA practices received only 13.2% of the total funding.
Cost-effective or optimal targeting EQIP EQIP
Shorter, flexible contracts EQIP EQIP Practices targeting downstream water quality improvements were
Tangible provision of an CREP EQIP* CREP; EQIP allocated the majority (56.5%) of EQIP’s funding from 1996 to 2012.
ecosystem service The second largest portion (19.96%) of the budget was allocated to­
(conditionality) wards assisting farmers in generating provisioning ES, or the production
Participatory design process to EQIP
encourage trust and cooperation
of agricultural products. TA received the least funding, with only 3.24%
of the program users of the budget allocated towards those EQIP practices. Figs. 3 and 4
Financial incentive must exceed CREP CREP; EQIP demonstrate that EQIP partially meets the checkpoint of conditionality
the opportunity cost of the user’s identified in Table 2. While EQIP does fund ES-generating practices,
alternative land use
others are solely for private farmstead benefits.
*
The provision of ES is dependent upon the practice implemented. Despite the small proportion of the budget allocated towards TA,

6
G. Del Rossi et al.
Fig. 3. Allocation of EQIP budget among the six ES categories of EQIP practices, 1996–2012.
Fig. 4. Distribution of financial cost-share payments by category by Farm Bill (1996–2008).
EQIP meets the intermediaries and technical assistance checkpoint
identified in Table 2. One reason TA payments comprise a slim portion of
the funding (3.24%) despite there being many projects (n = 1402) is that
TA is free if the producer met the cost-share cap of $450,000 on EQIP
contracts. Further, TA is a low-cost practice, compared to practices
having structural components.
Additionally, certain practices within Supporting ES, such as moni­
toring and evaluation were accounted for, and we argue this meets the
criteria of a “results-oriented” method to develop indicators to monitor
environmental results. Monitoring allows NRCS to evaluate how effec­
tive certain practices are at achieving environmental goals, such as
reducing nutrient runoff. We suggest monitoring serves as a Supporting
ES since it captures the effectiveness of other ES through EQIP practices.
Yet, monitoring-based practices only account for 70 observations and
have a median of $430.63. There may be little motivation to enact this
practice due to farmers having to pay a portion of the cost share.
However, for more effective monitoring of ES benefits, the budget for
Supporting ES may need to be increased, as it received only 5.33% of
EQIP’s budget (Fig. 3).
Fig. 4 depicts the distribution of the financial cost-share payment per
ES category for the 1996, 2002, and 2008 Farm Bill durations. To see
descriptive statistics, please see Appendix F. Overall, the funding allo­
cation for all practices increased with each Farm Bill, starting at $3.9 M
in 1996, $27.2 M in 2002, and $35.2 M in 2008. These increases in
funding were not driven solely by large, capital-intensive projects, as the
medians of each category exhibited an increase over time, except for
7
Ecosystem Services 47 (2021) 101223
Farmstead Practices and Non-Water Quality Regulating ES. One expla­
nation for this shift is the enactment of the 2002 TMDL for Vermont’s
portion of Lake Champlain. Since it was experiencing increased cyano­
bacteria blooms and its overall water quality had degraded, more
funding was allocated towards practices addressing water quality, rather
than practices which primarily benefit the farmstead or practices
providing regulating services not directing impacting water quality,
such as carbon sequestration. This suggests an attempt at cost-effective
targeting, and EQIP fulfilling its mandate to prioritize the most pressing
resource concerns. However, determining how effective these practices
are in reducing phosphorus pollution and achieving other environ­
mental goals remains an area for further research due to limited efforts
to monitor the performance of BMPs in the LCB.
Next, we examined the distributions of financial cost-shares within
each category. While practices targeting downstream water quality
comprise more than half of all EQIP funding, Farmstead Practices
received the greatest median cost-share, and thus, are more expensive to
implement. A potential explanation for these high payments is that
Farmstead Practices require large, up-front capital costs (construction,
labor, etc.) and therefore require a larger cost-share payment.
Conversely, practices with lower median incentives falling under the
categories of non-water quality Regulating ES and water quality Regu­
lating ES do not have high capital costs, but may have significant
operation and maintenance (O&M) costs, which are not included in
EQIP’s cost-share payments (Appendix B). We argue O&M costs fall
under transaction costs because the producer must bear the cost of
G. Del Rossi et al. Ecosystem Services 47 (2021) 101223

implementing the “transaction.” Therefore, EQIP fails to keep trans­ Table 3

actions costs low for farmers who implement ES-providing practices. Farmers’ perceptions of EQIP and CREP as derived from the thematic analysis (n
Furthermore, there is a discrepancy between the mean and median = 15).
cost-share values for most categories and Farm Bill durations, suggesting EQIP CREP
a skew to the program data (i.e. many outliers) (Fig. 4). Practices falling Strengths Response Strengths Response
under downstream water quality Regulating ES have a higher overall Frequency Frequency
mean payment ($644.58), and high mean payments compared to the (n) (n)
median for each Farm Bill period. Whereas, Farmstead Practices also Financial cost-share 9 Environmental 8
have a greater mean than median ($489.56), but there is less skew to the benefits
data. While this may be partly due to differences in sample size, there are On-farm planning 8 Financial incentive 5
discrepancies within the data suggesting extreme outliers in practices Environmental benefits 6 Retiring marginal land 4
into forested riparian
which provide downstream water quality ES. For example, the buffer
maximum financial cost-share payment for downstream water quality Partnership with NRCS 5 On-farm planning 2
Regulating ES is $33,468.80 and $5,229.56 for Farmstead Practices. Technical assistance 3 Easy enrollment 2
While EQIP is mandated to implement the least-cost alternative practice Geographic targeting 2 Improved animal 2
productivity and
that addresses the resource concern (e.g. water quality, nutrient runoff),
health
certain practices such as Waste Storage Facility within downstream Local prioritization 2 Bring into compliance 1
water quality Regulating ES have high cost-shares, vastly skewing the with regulations
distribution of that category. Indeed, this single practice accounts for Easy enrollment 2
31.03% of all programmatic payments, confirming Bailey and Merri­ Flexibility with farmers 2
ideas
gan’s (2010) findings. However, there are other NRCS practices which Bring into compliance 1
could address the resource concern at a lower cost, suggesting there may with regulations
be an institutional bias towards large-scale structural “end of pipe”
Weaknesses Weaknesses
practices rather than preventative practices to provide downstream ES Bureaucracy 7 Bureaucracy 5
benefits. $450,000 cap per Farm 4 No financial incentive 4
Bill to replant trees if
3.3. Farmer perceptions of EQIP & CREP from interviews initial buffer fails
Priority ranking lists 4 Decreased farm 3
productivity
Table 3 reports on farmers’ perceptions of EQIP and CREP, including Delay in receiving 4 Annual rental rate is 2
their strengths, weaknesses, and opportunities for improvement. We payment too low
focus on the following questions: What does the interview data reveal Cost-share is not high 3 Social norms & 2
enough aesthetics
about farmers perceptions of EQIP and CREP? What does the data reveal
Government Regulation 3 Not aligned with state 2
about the institutional design of EQIP and CREP? And which check­ regulations
points in Table 2 are elucidated through the interviews? Regional cost estimates 2 Long contract length 1
Table 3 captures the diversity of strengths, weaknesses, and oppor­ are too low
tunities for improvement farmers (n = 15) perceived regarding their Poor Engineering 2 Program size 1
Focus on expensive 2
participation and knowledge of EQIP and CREP. The most-commonly practices
cited strengths of these programs were the financial-cost share (n = Non-preventative 2
9), on-farm planning (n = 8), and environmental benefits for EQIP (n = program
6). For CREP the most frequent strengths included environmental ben­ Comprehensive nutrient 1
management plan
efits (n = 8), financial incentives (n = 5), and retiring marginal land (n
= 4). It is important to note that EQIP and CREP offer differing financial Opportunities for Opportunities for
payment structures that are reflected here and discussed further below. improvement improvement
Increase knowledge of 8 Increase knowledge of 7
Conversely, the weaknesses of EQIP and CREP also regarded the finan­ program program
cial incentives offered, as well as transaction costs; EQIP’s top identified Reduce government 6 Reduce government 4
weaknesses include bureaucracy (n = 7), the $450,000 cost-share cap (n bureaucracy bureaucracy
= 4), and the priority ranking lists (n = 4). CREP’s most cited weak­ Encourage 3rd parties 5 Increase state cost- 4
and partnerships share to improve tree
nesses identified were also bureaucracy (n = 5), no financial incentive to
health
replant trees if initial buffer fails (n = 4), and decreased farm produc­ Allow for greater 5 Keep annual rental 2
tivity (n = 3). Finally, the opportunities identified to encourage partic­ flexibility in the role rates set higher
ipation reflect many institutional design criteria, suggesting alignment of state
with the criteria could improve participation. For example, increased administration
Shift away from 4 Encourage 3rd parties 1
knowledge of EQIP (n = 8) and CREP (n = 7) through technical assis­
expensive, lock-in and partnerships
tance and extension could encourage participation in EQIP and CREP. practices aimed at
Government bureaucracy (n = 6, n = 4 for EQIP and CREP, respectively) large farms
and other associated transaction costs could be reduced by encouraging Increase the $450,000 2
cap
3rd parties and partnerships (n = 5, n = 1 for EQIP and CREP, respec­
Ensure certified NRCS 1
tively), as well as allowing for greater flexibility in the role of state practices comply with
administration (n = 5). state laws
Overall, the farmers who have participated in EQIP described mostly
positive experiences demonstrated in Table 3. Participants identified the
partnership with NRCS (n = 5) and the TA they provide as a major matching dollars, and both things help the farmer, help the environ­
programmatic strength: “The folks that we’re working with, they know ment, and it’s a win–win.” NRCS serves as an important intermediary
us intimately. They know our farm, they know our fields, they come and and offers valuable TA to program participations, meeting the criteria
they know what the issues are that we’re trying to repair or fix or identified in Table 2. Similarly, we argue that EQIP successfully en­
improve,” and “they bring with them the expertise and sometimes some courages the trust and cooperation of the program users by showing

8
G. Del Rossi et al.
flexibility with project design, thereby meeting the participatory design
checkpoint. Farmers felt NRCS listened to their concerns and suggestions
for projects and worked with them to achieve a mutual vision for
managing farm resource concerns.
Interviewees identified geographic targeting (n = 2) and local pri­
oritization (n = 2) as a positive aspect of participating in EQIP, meeting
cost-effective or optimal targeting. As one NRCS agent stated: “we can
steer things to where we, as people, as scientists, know where they need
to be used…because these are the worst problems, and we can sort of
prove it or at least show that some of those worst problems get solved by
creating funding pools.” This line of evidence confirms EQIP aims to
alleviate environmental degradation in a cost-effective way. Further,
interviewees confirmed our earlier findings that enrolling in EQIP is a
simple process (n = 2), meeting the checkpoint of short contract dura­
tion and flexible contracts.
While EQIP only provides a 75% of cost-share and provides no
annual incentive payment, the interview data reveals the financial cost-
share may be high enough to cover the opportunity cost of participation
for certain interviewees: “I have to tell you- that if we didn’t have
financial incentive to put these projects into place we would have never
done them.” Further, the financial cost-share was the most frequently
cited program strength of EQIP (n = 9), showing providers might not
need the full opportunity cost compensation to encourage participation,
especially if there are hidden or intrinsic motivators (e.g. environmental
stewardship). For certain interviewees, the environmental benefits
derived from the program is a major strength (n = 6) and reason for
participation. While ES provision is not guaranteed by all EQIP prac­
tices, farmers saw the ecosystem benefits generated by certain practices
implemented on the farm: “I think the biggest thing was the water
quality and the ability to allow me to do what I did to this farm, to
improve the overall water quality in this watershed,” and therefore
showing EQIP meets the conditionality criteria.
Fewer strengths were identified for CREP, perhaps because it is a
smaller, lesser-known and more targeted program than EQIP. As with
EQIP, CREP participants identified continuous enrollment (n = 2) and
aiding compliance with regulations (n = 1) as programmatic strengths.
Further, interviewees most-frequently identified environmental benefits
as a major reason for participation: “[Under CREP], cows were out of the
water, the brooks look clean. The vegetation that was planted is
thriving– the CREP program was huge for me,” meeting the condition­
ality checkpoint. As discussed in 3.1, CREP successfully covers the user’s
opportunity cost of an alternate land use through the implementation
cost-share and the annual rental payments; likewise, our interview data
confirms the program meeting that checkpoint. After environmental
motivations, interviewees identified the financial incentive (n = 5)
CREP provides as the second-most frequent reason for participation.
Additional field experiments could reveal if these stated beliefs reflect
the true motivations for farmers enrollment in both programs.
Conversely, interviewees identified aspects of both programs they
find problematic or discourage enrollment, indicating where EQIP and
CREP fail to meet the institutional markers (Table 2). Farmers and
technical agents identified bureaucracy and excessive paperwork (i.e.
high transaction costs) as the biggest barrier to farmer enrollment in
EQIP and CREP (n = 7, n = 5 for EQIP and CREP, respectively). One
farmer stated it took 5 to 6 different rounds of signatures to get one
project approved. Four others referenced delays of payments. As one
interviewee said:
“I don’t see that money for a long time… I got a $600,000 project
next summer and I’m tearin’ my hair out about [it]. I won’t get paid
until the job is complete, inspected, they’ve crossed their t’s, dotted
their i’s… and then take 3 weeks of vacation to think about it, and
then they’ll pay me…That’s a huge deterrent for any of those
programs.”
Other interviewees noted high transaction costs associated with
9
Ecosystem Services 47 (2021) 101223
participation: “there’s just so many t’s to cross and i’s to dot, to get
through just one program” and a “mountain of paperwork” associated
with implementing the CNMP (n = 1).
Interestingly, the interview data reveal contradictions regarding the
institutional design of EQIP and CREP. While some participants appre­
ciate the partnership with NRCS and feel as though there is a mutual
project design process; others felt as though both EQIP and CREP suf­
fered from top-down control and rigidity (government regulation, n =
3), and the farmers suffered the consequences: “I don’t know who sets
the standards for these things, but they’re not farmers.” Many feel as
though the programs are not designed with their needs in mind, and
consequently are reluctant to participate. Similarly, interviewees
believe the regional EQIP cost-share estimates of practices are too low
(n = 2) and end up paying more than anticipated: “Basically, I spent
$26,000 dollars and they reimbursed me $17,000. And I wouldn’t have
put $9000 dollars of my own money into it, but I thought they were
going to reimburse me fully.” For some, the 75% cost-share for EQIP
covers the costs of participating, but others need a greater incentive to
enact practices. Strengthening third party partnerships, increasing local
and state flexibility, and increasing access to information were all op­
portunities respondents identified for improving participation and are
well-aligned with the institutional design criteria identified in Table 2.
4. Discussion
Our literature review (Table 1) and mixed methods analysis identi­
fied numerous aspects of PES that encourage farmer participation. Our
results show where CREP and EQIP have succeeded – and failed – in
achieving these markers.
Table 4 depicts our final analysis of whether EQIP and CREP
encourage participation based on their institutional design. Rather than
using a dichotomous classification system, we evaluate EQIP and CREP’s
performances based upon how much evidence our results revealed that
EQIP and CREP met these indicators. In some cases, the stated purposes
of a program may suggest stronger adherence to the PES principles than
what has been achieved. Thus, based on our results we indicated if there
is no evidence of the program meeting the criteria (X), if there is some
evidence of meeting the criteria (★), and if the results provided ample
evidence of meeting the criteria (✓).
Our analysis shows EQIP meets more of the institutional design
criteria for encouraging participation than CREP does (Table 4). This has
interesting implications regarding future design of PES and AEPs, as it
suggests there may be a tradeoff between encouraging participation and
achieving environmental effectiveness. CREP is considered a “true” PES
program by multiple sources (Chapman et al., 2019; Sattler et al., 2013;
Schomers & Matzdorf, 2013), whereas the argument for EQIP is less
convincing, due to its 75% financial cost-share and practices not directly
yielding ES or clear environmental benefits. CREP not only is a targeted
Table 4
EQIP and CREP’s adherence to institutional markers encouraging participation
in PES programs.
Checkpoint EQIP CREP
The use of intermediaries and technical assistance ✓ X
A “results oriented” method to develop indicators to monitor ★ X
environmental results.
Rules are simple and easy to understand; easy to enforce ★ ✓
Low transaction costs X X
Cost-effective or optimal targeting X
★
Shorter, flexible contracts ✓ X
Tangible provision of an ecosystem service (conditionality) ★ ✓
Participatory design process to encourage trust and cooperation of ★ X
the program users
Financial incentive must exceed the opportunity cost of the user’s X
✓
alternative land use
G. Del Rossi et al.
program with the explicit goal of retiring marginal land into riparian
buffers to reduce nutrient and sediment loads entering waterways, but it
further offers financial incentives to cover the opportunity cost of not
farming the land allocated to conservation. While CREP can achieve
high environmental effectiveness and its incentive structure can cover
the full opportunity cost to engage farmers in this program, theoretically
increasing enrollment, other aspects of CREP may discourage partici­
pation. For example, this program does not apply to farmers who do not
have land adjacent to waterways. Conversely, EQIP’s mandate is much
broader, leading to a less targeted provision of environmental benefits
but significantly greater program participation, despite the financial
cost-share not covering the full cost of participation.
When designing PES programs, there are tradeoffs inherent between
institutional checkpoints, and policymakers must consider the interac­
tion of these tradeoffs to maximize programmatic goals. For example,
CREP has a contract length of 15 years, which contradicts the checkpoint
of short, flexible contracts and may decrease participation. An addi­
tional contradiction is there are higher transaction costs associated with
shorter contracts, and longer contracts would alleviate the transaction
costs associated with contract renewals. However, both EQIP and CREP
require the provider to fully reimburse the funding agency if they break
the contract prior to the predetermined length. For CREP, this may
discourage farmers from engaging in a 15-year contract, regardless of
whether the transaction costs are lower. Yet, shorter contracts may fail
to achieve environmental effectiveness (Engel, 2016), exemplifying the
tradeoff between achieving the environmental goals of a PES scheme
and encouraging participation. Shorter contracts may appear to be a
farmer “wish list” item for designing PES, yet the contract length must be
balanced against environmental goals and encouraging high enough
participation rates to achieve the programmatic ecological goals (Muñoz
Escobar et al., 2013; Mettepenningen et al., 2013).
While EQIP and CREP already adhere to many of the PES design
checkpoints, our results also indicate further improvements could be
made to increase participation in both programs. For instance, high
transactions costs and administrative complexity for both EQIP and
CREP discourage participation by producers who lack time or resources
to deal with extensive paperwork and recordkeeping. As the interview
data show, many farmers feel high transaction costs are a major deter­
rent to participation in EQIP and CREP, which further confirms Reimer
& Prokopy’s (2014) conclusions. One further explanation follows Fal­
coner’s (2000) work, which states that if transaction costs are not
compensated for in the financial incentive structure, they will be sub­
sumed into the compensation producers receive and thus lower partic­
ipation. In addition to high transaction costs, farmers are responsible for
the operations and management costs associated with practices after the
initial cost-sharing incentive has been awarded, which could impede
farmer participation in these programs.
However, many of the transaction costs farmers feel burdened with
could be ameliorated by increasing the TA provided by intermediary
organizations (Christensen et al., 2011; Schomers et al., 2015; Falconer,
2000). Intermediary organizations such as NRCS, watershed coalitions,
and extension services were frequently identified as programmatic
strengths for both EQIP and CREP. Interviews demonstrated that farmers
value the working partnership with NRCS agents and believe they are
critical partners in the successful implementation of these programs.
Other intermediary organizations that reduce the burden of transaction
costs are farmer social networks and third parties such as watershed
coalition networks, comprised of farmers, extension, and TA agents who
meet regularly to discuss issues and find creative solutions to environ­
mental problems. Increasing the TA offered through these programs
could decrease high transaction costs and build trust and cooperation of
the program users to encourage greater participation.
Our mixed methods analysis confirms EQIP and CREP attempt to
meet the conditionality checkpoint, and the interview data demon­
strated the environmental benefits generated by these programs moti­
vate farmers to enroll. Moreover, EQIP funds many practices which
10
Ecosystem Services 47 (2021) 101223
potentially provide ES, and CREP funds targeted land uses to provide ES
as well. One limitation of our research is that the EQIP practices we
categorized to provide ES may not guarantee conditionality. Many of the
NRCS-certified practices have not been extensively studied to determine
the extent of their ES provision, remaining an area for further research.
Additionally, EQIP and CREP have yet to implement an extensive
monitoring program to ensure the provision of ES, including down­
stream water-quality benefits necessary for corroborating the watershed
management portion of the mandate for these programs.
One way to ensure conditionality in PES programs is through
monitoring to guarantee environmental effectiveness (Engel, 2016).
While EQIP does fund some monitoring practices, very limited efforts
have been made to monitor practices rigorously in Vermont. Further, as
one technical agent highlighted, “there’s this practice called edge-of-
field, which is a study practice that serves really no benefit for the
farmer… it measures the effectiveness of NRCS conservation practices,
but to get a farmer to sign up to do it – and they know it cuts out of their
$450,000—[it’s] very hard to get people to sign up for it.” To mitigate
this barrier, we believe creating a separate budget for monitoring
practices in EQIP would not only allow farmers a greater budget for
implementing other practices, but it could also improve overall moni­
toring efforts and the resulting knowledge regarding the effectiveness of
different practices.
Increased monitoring could prove challenging, however, since
transaction costs rapidly increase when payments are more targeted
toward practices requiring more extensive monitoring (Vatn, 2010).
Moreover, assessing the effectiveness of EQIP in smaller watersheds is
challenging since long-term river water quality monitoring stations in
the LCB are typically located near the mouths of major tributaries to
Lake Champlain (Underwood et al., 2017), not near the farms them­
selves. The diffusion of cheap soil and water quality monitoring sensors
can, however, generate large social and environmental benefits, and the
deployment of such sensor networks at watershed scales can be aligned
with PES incentive designs (Zia et al., 2020).
While a greater alignment with the PES institutional design criteria
we identified could increase participation in both EQIP and CREP, it may
come at the cost of achieving other programmatic goals, having
important implications regarding the future design of PES schemes.
Therefore, we argue one must consider the overarching goals of the PES
or agri-environmental scheme: is the goal of the program to achieve a
singular ES, or bundled ES, or to alleviate poverty (Pagiola et al., 2005)?
Or rather, is it to help participants achieve broad farmstead and envi­
ronmental benefits, some of which may achieve ES provision? Each goal
requires different institutional structures and designs for achieving
programmatic goals and may encourage differing levels of participation.
Our checklist identifies different permutations and combinations of
design criteria that might affect participation dependent upon pro­
grammatic goals. While encouraging provider participation is impor­
tant, it should not be considered an end goal of successful PES or AEP.
Rather, we argue programmatic design should encourage participation
to the extent necessary for a program to achieve its environmental and
social goals. Our research has identified institutional designs and
structures that could facilitate provider adoption of an AEP or PES
program and contribute towards achieving their environmental goals.
5. Conclusions
In this study, we examined which institutional structures and rules
can encourage or discourage participation in EQIP and CREP in the Lake
Champlain Basin. We generated a checklist of institutional criteria for
PES programs to encourage provider participation and applied it to our
mixed methods analysis of legal document analysis, ES data analysis,
and semi-structured interviews. Using mixed methods provided multiple
lines of evidence regarding EQIP and CREP’s successes and failures in
meeting institutional design criteria encouraging farmer participation.
Our legal document analysis revealed CREP effectively covers the
G. Del Rossi et al.
opportunity cost of providers alternate land uses, and the simple
enrollment process for both CREP and EQIP encourages participation.
Further, although EQIP is mandated to minimize transaction costs, the
institutional rules of EQIP contradict this by placing exceedingly high
administrative, operational, and maintenance costs upon those who
participate.
To assess the provision of ES, we classified the ES practices funded by
EQIP provide using the MEA (2005) and determined the practices in
EQIP providing downstream water quality benefits. We found down­
stream water quality Regulating ES practices are allocated most of the
funding, but there may be an institutional bias towards large structural
practices focusing on “end of pipe” nutrient management strategies,
which calls for further study. Additionally, there was a funding shift
away from Farmstead and non-water quality Regulating ES practices
between the 2002 and 2008 Farm Bill towards downstream water
quality practices, possibly in response to the 2002 TMDL issued by the
EPA for Lake Champlain. This demonstrates EQIP is practicing some
degree of cost-effective targeting.
The semi-structured interviews elucidated which checkpoints EQIP
and CREP met to encourage participation as well as some contradictions
in the implementation of the programs. Many farmers identified the
partnership with NRCS as crucial to their participation. Farmers also
identified the environmental benefits, the financial incentives, and ease
of enrollment as reasons for participating in both programs. Despite the
TA provided, many interviewees felt the transaction costs were high
enough to discourage participation: they cited delayed payments,
paperwork, complex and competitive priority ranking lists, and un­
foreseen operation and maintenance costs.
While EQIP and CREP both meet several institutional design markers
for successfully encouraging participation, closer alignment with certain
PES design principles could increase participation. We recommend
increasing the TA provided as it can ameliorate burdens associated with
transaction costs and encourage greater trust and cooperation amongst
program users. Further, we recommend determining which NRCS-
certified practices successfully provide ES to show conditionality as an
area for further research. Finally, we suggest creating a separate moni­
toring budget to enhance participation. This also has the benefit of
helping to determine which practices are most cost-effective for
reducing nutrient loading to help the programs reach their environ­
mental goals. A greater emphasis on results-oriented monitoring of
environmental benefits – including water quality – is necessary to direct
future optimal-targeting efforts by these programs.
In summary, our analyses provide multiple lines of evidence that
clearly illustrate that following PES institutional design principles more
closely could further increase farmer participation in EQIP and CREP,
and ultimately, improve the water quality and the provisioning of other
ES in the Lake Champlain basin. Our findings encourage larger-sample
studies in other jurisdictions featuring a wider range of farmers
participating in EQIP to make more generalizable conclusions about the
role that increasing farmer participation could have in improving
downstream water quality and the provision of other ES.
Declaration of Competing Interest
The authors declare that they have no known competing financial
interests or personal relationships that could have appeared to influence
the work reported in this paper.
Acknowledgements
This material is based upon work supported by the National Science
Foundation under VT EPSCoR Grant OIA-1556770. Any opinions, find­
ings, and conclusions or recommendations expressed in this material are
those of the author(s) and do not necessarily reflect the views of the
National Science Foundation. Thank you to the two anonymous re­
viewers for their thoughtful comments and suggestions in improving this
11
Ecosystem Services 47 (2021) 101223
manuscript. We would like to thank the individuals from USDA NRCS,
USDA FSA, VAAFM and the farmers we interviewed for their time and
perspectives.
Appendix A. Supplementary data
Supplementary data to this article can be found online at https://doi.
org/10.1016/j.ecoser.2020.101223.
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