1. 2014 Easement Compensation Jason S Kepler Resource Conservationist

2. Some Easement Notes Will be discussing Compensation for WRP and GRP Will be discussing Compensation for WRP and GRP Due to Farm Bill expiration, currently have no authority to act on these easement programs Due to Farm Bill expiration, currently have no authority to act on these easement programs NRCS has prepared in the event they are reauthorized for FY14 NRCS has prepared in the event they are reauthorized for FY14 Currently, only easement program with authority to act is FRPP (Farm and Ranch Lands Protection Program) Currently, only easement program with authority to act is FRPP (Farm and Ranch Lands Protection Program)

3. GRP and WRP Easement Compensation Annually establish easement compensation values for the Grasslands Reserve Program (GRP) and the Wetlands Reserve Program (WRP) Annually establish easement compensation values for the Grasslands Reserve Program (GRP) and the Wetlands Reserve Program (WRP) Geographic Area Rate Caps (GARCs) Geographic Area Rate Caps (GARCs) Historically have done area wide market analysis in sub-regions across the state Historically have done area wide market analysis in sub-regions across the state Annual cost of market analysis around $10,000 Annual cost of market analysis around $10,000 Have not used analysis since 2010 (lack of applications) Have not used analysis since 2010 (lack of applications)

4. GRP and WRP Easement Compensation States with limited applications, have another option States with limited applications, have another option Can use individual appraisals for each property Can use individual appraisals for each property The Pros The Pros Less overall expense for NRCS Less overall expense for NRCS Only pay for what we need, when we need it Only pay for what we need, when we need it More accurate compensation rate More accurate compensation rate The Cons The Cons May take additional time to conduct appraisal, evaluate and close the easement May take additional time to conduct appraisal, evaluate and close the easement

5. GRP and WRP Easement Compensation FY 2014 ≠ GARCs WRP Compensation – By Appraisal WRP Compensation – By Appraisal Expected to be around 90% of Fair Market Value Expected to be around 90% of Fair Market Value Not to exceed $5,000 per acre Not to exceed $5,000 per acre GRP Compensation – By Appraisal GRP Compensation – By Appraisal Expected to be between 60 and 75% of Fair Market Value Expected to be between 60 and 75% of Fair Market Value Dependent on productivity of land and carrying capacity Dependent on productivity of land and carrying capacity

6. Questions on GRP and WRP Easement Compensation?

7. 2014 Payment Schedules Jason S Kepler Resource Conservationist

8. 2014 Payment Schedules Very similar process to FY13 Very similar process to FY13 AZ is part of a 5 state region (with NM, CO, UT, NV) AZ is part of a 5 state region (with NM, CO, UT, NV) Generalized costs amongst 5 states Generalized costs amongst 5 states FY14 Payment Schedules still being reviewed and finalized FY14 Payment Schedules still being reviewed and finalized Info in this presentation may change Info in this presentation may change

9. 2014 Payment Schedules Arizona only had issues with about 5% of FY13 Practices and Costs on the Payment Schedule Arizona only had issues with about 5% of FY13 Practices and Costs on the Payment Schedule AZ provided this feedback to “regional team” on FY13 Issues AZ provided this feedback to “regional team” on FY13 Issues Costs too high or too low Costs too high or too low Need for additional scenarios Need for additional scenarios Most issues have been addressed Most issues have been addressed

10. FY2013 Issues and FY2014 Updates 314, Brush Management 314, Brush Management Issue: No high cost scenario for Chemical, Aerial Application Issue: No high cost scenario for Chemical, Aerial Application Outcome: New scenarios with relevant associated costs Outcome: New scenarios with relevant associated costs Low Cost Chemical, Aerial Applied Low Cost Chemical, Aerial Applied High Cost Chemical, Aerial Applied High Cost Chemical, Aerial Applied 382, Fence 382, Fence Issue: FY13 Costs for Barbed Wire-Smooth was too low Issue: FY13 Costs for Barbed Wire-Smooth was too low Outcome: FY14 cost increases ~35% Outcome: FY14 cost increases ~35%

11. FY2013 Issues and FY2014 Updates 428, Irrigation Ditch Lining 428, Irrigation Ditch Lining Issue: No scenario for Notched Ditches Issue: No scenario for Notched Ditches Outcome: New scenario and costs established for Notched Ditches Outcome: New scenario and costs established for Notched Ditches 442, Sprinkler Irrigation System 442, Sprinkler Irrigation System Issue: No scenario for Poly-Lined Pivots Issue: No scenario for Poly-Lined Pivots Outcome: Still pending development of additional cost for poly lining Outcome: Still pending development of additional cost for poly lining

12. FY2013 Issues and FY2014 Updates 614, Watering Facility 614, Watering Facility Issue: FY13 costs for Permanent Drinker/Storage >5,000 gallons was too low Issue: FY13 costs for Permanent Drinker/Storage >5,000 gallons was too low Outcome: FY14 cost increases ~40% Outcome: FY14 cost increases ~40% 614 Watering Facility 614 Watering Facility Issue: No scenario for electronically monitored watering facilities Issue: No scenario for electronically monitored watering facilities Outcome: Request for new component was denied (twice) Outcome: Request for new component was denied (twice) Remote watering considered a luxury/top of the line watering facility. Remote watering considered a luxury/top of the line watering facility. Only allowed to cost share on standard practices. Only allowed to cost share on standard practices.

13. Thank You Jason Kepler Resource Conservationist Jason.Kepler@AZ.USDA.gov (602) 280-8824