Upcoming Changes in Maryland's Agricultural Cost Share Program
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A bill (S.B. 344) passed by the Maryland State Legislature during the 2021 session changes the Maryland Agricultural Cost-Share (MACS) Program by increasing the allowable amount of State funding available for certain projects from 87.5% to 100%. The MACS Program is one of several initiatives established to improve water quality and achieve State water quality goals, and the recent changes are expected to help Maryland satisfy Chesapeake Bay clean-up goals while having a meaningful impact on farm businesses.
Maryland Agricultural Water Quality Cost-Share Program
Beginning in July 2021, MDA will be able to provide up to 100% of eligible costs for the implementation of certain conservation practices on farms. The total amount of cost-share funding available from the MACS Program has been, for many years, at the same level of 87.5 % of the cost to install the conservation practice. The change was strongly supported by the agricultural community, several farm interest groups submitted favorable testimony to State lawmakers during bill deliberations. This enhanced funding assistance will provide an additional incentive to install Best Management Practices (BMPs) to meet Maryland’s Watershed Implementation Phase (WIP) III goals.
Since 1982, the State of Maryland has administered the MACS Program to reduce the impacts of non-point source pollution from farmers on water quality by providing financial assistance for the implementation of agricultural best management practices (BMPs). Grassed waterways, streamside buffers, and animal waste storage systems are among more than 30 BMPs eligible for funding under the program. Some conservation practices result in a reduced crop production area and increased maintenance responsibilities, therefore, cost-share funding is crucial to incentivize farmers to implement the practices.
The MACS program is currently managed by the Maryland Department of Agriculture (MDA) and administered by local Soil Conservation Districts (SCDs). MACS provides farmers with grants to cover the cost of implementing best management practices that reduce soil and nutrient runoff from farmland. The total amount of cost-sharing a farmer can receive is still limited to (1) $50,000 per project and $150,000 per farm, for projects other than animal waste treatment and containment projects and (2) $200,000 per project and $300,000 per farm for animal waste treatment and containment projects. The fiscal 2022 capital budget includes $5.0 million in general obligation bond funding for the installation of best management practices under MACS.
The MDA has discretionary control over which practices will be eligible for the 100% cost-sharing, and priority will be given to those that will help Maryland meet Chesapeake Bay clean-up goals. (See MDA's Letter of Support and Chesapeake Bay Foundation Letter of Support for the bill.) The increased MACS cost-share allotment will automatically terminate on June 30, 2026 unless the Legislature takes action to extend or amend the Act.
MACS Program and Chesapeake Bay Clean-Up Goals
The MACS Program is credited as one of the reasons Maryland, at the 2017 Chesapeake Bay clean-up mid-point assessment, had met its reduction goals for both phosphorus and sediment. Between fiscal years 2009 and 2017, the MACS Program provided $54.6 million in grant funding toward the installation of 4,435 conservation practices on Maryland farms. Maryland, along with the five other Bay states and the District of Columbia, have committed to achieve their Chesapeake Bay water quality clean-up goals by 2025 and the continued implementation of agricultural conservation practices are a critical component of the agriculture sector reaching those goals.
Between now and 2025, Maryland plans to reduce nitrogen from agriculture by almost 5 million pounds, and according to the Phase III Watershed Implementation Plan, the nitrogen reduction in the agricultural sector will be achieved, in large part, through high rates of BMP implementation.