Presentation on theme: "Nebraska CPA-52 Economic and Social Considerations."— Presentation transcript:
Nebraska CPA-52 Economic and Social Considerations
There are seven categories to evaluate when looking at Economic and Social Considerations –Land Use –Capital –Labor –Management Level –Profitability –Risk –Social Issues/Other
Economic and Social Considerations: Capital “It is the policy of the Department of Agriculture and the NRCS that economic principles be included in all planning and agency resource allocation activities” (GM200-Economics, Subpart A, 400) NRCS Policy prohibits employees from obtaining financial information beyond what is provided voluntarily by the client. Refer to the National Resources Economics Handbook, Part 610 Conservation Planning or call the State Economist for assistance in conducting an economic analysis.
Economic and Social Considerations: Land Use Land is the Basic Unit of Production Where Crops are Grown, Livestock Graze Where Wildlife Live Land is Measured in Acres Productivity is Measured in Bushels, AUM’s, etc. Farm Machinery & Structures are Included
Economic and Social Considerations: Land Use Is the present land use suitable for the proposed practice? –Is it possible to restore enough components of bobwhite quail habitat on this cropland to actually support bobwhite quail, given that there is no suitable habitat nearby? Will land use change after practice installation? –Will cropland be converted to buffers so it will no longer be cropped? How will a change effect the operation? –Will the mix of feed and forage produced change?
Economic and Social Considerations: Land Use Will the action affect community institutions, traditions or values, or the way of life for individuals in the community? Will the action affect resources on which people depend for subsistence, employment or recreation? –Will conversion of cropland to CRP reduce employment opportunities for members of the community?
Economic and Social Considerations: Capital The Landowner’s “Ability to Pay” Measured As –Monetary Assets (Dollars) –Physical Assets (Land & Machinery) –Ability to Borrow Money (Credit) –Obtain Financial Assistance (Cost-Share) –Barter “Goods & Services”
Economic and Social Considerations: Capital What are the impacts of the cost of the initial investment for this conservation practice? What are the impacts of any additional annual costs for Operation & Maintenance (O&M) on this conservation practice?
Economic and Social Considerations: Labor The “Ability to Work” or Hire “Workers” Measured in Units of Time (Hours, Years) Includes the Landowner, Family, Hired Help or Other Trained Workers
Economic and Social Considerations: Labor Does the client understand the amount and kind of labor needed to implement, operate, and maintain the proposed practice? –Does the client have the skills and time to do pest scouting or will he/she have to hire someone else to do this?
Economic and Social Considerations: Management Level The Landowner’s “Knowledge, Skills and Ability” to Operate the Farm or Ranch Measured in Qualitative Units of Skill Level
Economic and Social Considerations: Management Level Does the client understand the inputs needed to manage the practice and their responsibility in obtaining them? –Indicate that additional time is involved in carrying out a nutrient management system, and reference the plan for those requirements. Does the client understand their responsibility to maintain the practice as described in the conservation plan?
Economic and Social Considerations: Profitability The Benefits and Costs of the Operation Often Measured in Dollars Profitable if Benefits Exceed Costs
Economic and Social Considerations: Profitability Is the proposed practice needed and feasible? Do the benefits of improving the current operation outweigh the installation and maintenance costs (positive benefit/cost ratio)? Is there a reasonable expectation of long-term profitability/benefits for the operation if the practice is implemented?
Economic and Social Considerations: Risk Exposure to monetary loss, injury, or damage to resources or the environment. Does the proposed practice aid/risk client participation in USDA programs? –Will a cornfield be converted to pasture, potentially affecting the crop base or history?
Economic and Social Considerations: Risk Risk is Measured in Qualitative Units –Crop, Livestock & Wildlife Yields –Is there flexibility in modifying the conservation plan at a future date? –What sort of issues are involved with the timing of installation, maintenance, etc.? Bird migration or nesting periods, T&E Considerations –What are the cash flow requirements of this conservation practice? Is the investment front heavy, back heavy, or evenly distributed?
Economic and Social Considerations: Risk Affects Landowner, Workers, Community –Will implementation of the proposed practice have an adverse impact on the community at large (off-site effects)? Will installing a new irrigation system affect availability of water to downstream or surrounding irrigators or home owners? –Are there any hazards involved? How heavy does a rainfall need to be before there is a risk of a dam overtopping?
Economic and Social Considerations: Social Issues and Other Concerns These items are very subjective based on client needs, wants, and values. –What may seem unimportant to you, may prove to be extremely important to your client. Social Considerations can include: –Public Health and Safety –Public and Private Values –Client Considerations –Risk Tolerance/Aversion –Tenure
Economic and Social Considerations: Social Issues and Other Concerns Includes any social or personal issue –Client Family Oriented –Values Education –Prefers Recreation Benefits over Increased Income –Other personal Concerns: age, family status, financial history/goals –Community views
Economic and Social Considerations: Social Issues and Other Concerns Many of these issues will depend on the social environment of the community in which you are working. –If a producer is going to try to implement a no-till system in an area that has traditionally been black farmed, be sure that the producer understands the peer pressure he/she may face from neighbors and that he/she is willing to deal with any negative reactions. –What can we do as employees of NRCS to support our clients in these difficult situations
Economic and Social Considerations: Social Issues and Other Concerns The planner must know the landowner and community so well that when it is time to implement the plan, it satisfies everyone’s needs so exactly that incentives or regulation are not necessary.
CPEE Conservation Practice Economic Effects –Similar to the CPPE (Conservation Practice Physical Effects). –Developed on a national level and tend to look at the long term impacts of a practice –Provides suggestions as to how the Economic and Social Considerations for a specific practice might be filled out, but please realize your own professional judgment may be more accurate for your location.
Filling out the Form CPEE –If filling out the NE-CPA-52 form electronically, the CPEE is available as an electronic tool within the NE-CPA-52 form. –If filling out the NE-CPA-52 form in hard copy, the CPEE is available in the e-FOTG under Section I, Cost Data.
Practice Effects Worksheet for Economic and Social Considerations