This is the accessible text file for GAO report number GAO-06-969 entitled 'Agriculture Conservation: USDA Should Improve Its Process for Allocating Funds to States for the Environmental Quality Incentives Program' which was released on September 27, 2006. This text file was formatted by the U.S. Government Accountability Office (GAO) to be accessible to users with visual impairments, as part of a longer term project to improve GAO products' accessibility. Every attempt has been made to maintain the structural and data integrity of the original printed product. Accessibility features, such as text descriptions of tables, consecutively numbered footnotes placed at the end of the file, and the text of agency comment letters, are provided but may not exactly duplicate the presentation or format of the printed version. The portable document format (PDF) file is an exact electronic replica of the printed version. We welcome your feedback. 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Report to the Ranking Democratic Member, Committee on Agriculture, Nutrition, and Forestry, U.S. Senate: September 2006: Agricultural Conservation: USDA Should Improve Its Process for Allocating Funds to States for the Environmental Quality Incentives Program: GAO-06-969: GAO Highlights: Highlights of GAO-06-969, a report to the Ranking Democratic Member, Committee on Agriculture, Nutrition, and Forestry, U.S. Senate Why GAO Did This Study: The Environmental Quality Incentives Program (EQIP) assists agricultural producers who install conservation practices, such as planting vegetation along streams and installing waste storage facilities, to address impairments to water, air, and soil caused by agriculture or to conserve water. EQIP is a voluntary program managed by the U.S. Department of Agriculture’s (USDA) Natural Resources Conservation Service (NRCS). NRCS allocates about $1 billion in financial and technical assistance funds to states annually. About $650 million of the funds are allocated through a general financial assistance formula. As requested, GAO reviewed whether USDA’s process for allocating EQIP funds to states is consistent with the program’s purposes and whether USDA has developed outcome-based measures to monitor program performance. To address these issues, GAO, in part, examined the factors and weights in the general financial assistance formula. What GAO Found: NRCS’s process for providing EQIP funds to states is not clearly linked to the program’s purpose of optimizing environmental benefits; as such, NRCS may not be directing funds to states with the most significant environmental concerns arising from agricultural production. To allocate most EQIP funds, NRCS uses a general financial assistance formula that consists of 31 factors, including such measures as acres of cropland, miles of impaired rivers and streams, and acres of specialty cropland. However, this formula has several weaknesses. In particular, while the 31 factors in the financial assistance formula and the weights associated with each factor give the formula an appearance of precision, NRCS does not have a specific, documented rationale for (1) why it included each factor in the formula, (2) how it assigns and adjusts the weight for each factor, and (3) how each factor contributes to accomplishing the program’s purpose of optimizing environmental benefits. Factors and weights are important because a small adjustment can shift the amount of funding allocated to each state on the basis of that factor and, ultimately, the amount of money each state receives. For example, in 2006, a 1 percent increase in the weight of any factor would have resulted in $6.5 million more allocated on the basis of that factor and a reduction of 1 percent in money allocated for other factors. In addition to weaknesses in documenting the design of the formula, some data NRCS uses in the formula to make financial decisions are questionable or outdated. For example, the formula does not use the most recent data available for 6 of the 31 factors, including commercial fertilizers applied to cropland. As a result, any recent changes in a state’s agricultural or environmental status are not reflected in the funding for these factors. During the course of GAO’s review, NRCS announced plans to reassess its EQIP financial assistance formula. NRCS recently developed a set of long-term, outcome-based performance measures to assess changes to the environment resulting from EQIP practices. The agency is also in the process of developing computer models and other data collection methods that will allow it to assess these measures. Thus, over time, NRCS should ultimately have more complete information on which to gauge program performance and better direct EQIP funds to areas of the country that need the most improvement. What GAO Recommends: GAO recommends, among other things, that NRCS document its rationale for the factors and weights in its general financial assistance formula and use current and accurate data. USDA agreed with GAO that the formula needed review. USDA did not agree with GAO’s view that NRCS’s funding process does not clearly link to EQIP’s purpose of optimizing environmental benefits. It believes that the funding process clearly links to EQIP’s purpose, but it has not documented the link. [Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-969]. To view the full product, including the scope and methodology, click on the link above. For more information, contact Daniel Bertoni at (202) 512-3841 or bertonid@gao.gov. [End of Section] Contents: Letter: Results in Brief: Background: NRCS's Process for Allocating EQIP Funds to the States Does Not Clearly Address the Program's Purpose of Optimizing Environmental Benefits: NRCS Has Begun to Develop More Outcome-Oriented Performance Measures: Conclusions: Recommendations for Executive Action: Agency Comments and Our Evaluation: Appendixes: Appendix I: Objectives, Scope, and Methodology: Appendix II: EQIP 2006 Funding Allocation Formulas: Appendix III: Statistical Techniques to Determine Influential Factors in the 2006 EQIP Financial Allocation Formula: Principal Components Regression: Factor Analysis of EQIP Environmental Variables: Appendix IV: Initial EQIP Funding Provided to the States, Fiscal Year 2006: Appendix V: Historical EQIP Funding Levels, Fiscal Years 2001-2006: Appendix VI: Fiscal Year 2005 EQIP Obligations by Conservation Practice: Appendix VII: Comments from the U. S. Department of Agriculture: Appendix VIII: GAO Contact and Staff Acknowledgments: Tables: Table 1: Fiscal Year 2006 Categories of EQIP Funding: Table 2: EQIP General Financial Assistance Formula Factors and Weights, Fiscal Year 2006: Table 3: EQIP Annual Performance Measures, Fiscal Year 2006: Table 4: EQIP Long-term Measures: Table 5: Factors, Data Sources, and Weights in the EQIP General Financial Assistance Formula for Allocating Funding to the States in Fiscal Year 2006: Table 6: Fiscal Year 2006 Formula for Allocating Ground and Surface Water Conservation Financial Assistance: Table 7: Factors Used in the Fiscal Year 2006 Formula for Allocating EQIP Performance Bonuses: Table 8: Fiscal Year 2006 Formula for Allocating Klamath Basin Program Financial Assistance: Table 9: Standardized Principal Components Estimators of the Original Variables and Statistical Significance: Table 10: Rotated Factor Pattern Matrix: Figure: Figure 1: Initial EQIP Funding to States, Fiscal Year 2006: Abbreviations: CAFO: Concentrated Animal Feeding Operations: EQIP: Environmental Quality Incentives Program: NRCS: Natural Resources Conservation Service: NRI: National Resources Inventory: USDA: U.S. Department of Agriculture: September 22, 2006: The Honorable Tom Harkin: Ranking Democratic Member: Committee on Agriculture, Nutrition, and Forestry: United States Senate: Dear Senator Harkin: Approximately two-thirds of the continental U.S.'s land area is used as range, forest, crop, or pasture land. The production of food and fiber on these lands contributes to the health of the U.S. population and the strength of the nation's economy. If not properly managed, however, agricultural production on these lands can damage the environment and the nation's natural resources, as when routine agricultural activities produce sediment, fertilizer runoff, and animal waste that can impair the nation's waterways. Improper management of natural resources can also reduce the productive capacity of agricultural land; for example, excessive soil erosion may lead to soil lacking in nutrients. Agriculture is also a major user of both groundwater and surface water, contributing, in part, to water scarcity in the western United States. Responsible production management practices can mitigate many of these problems. The Environmental Quality Incentives Program (EQIP) provides financial and technical assistance to agricultural producers who enter into contracts with the U.S. Department of Agriculture's (USDA) Natural Resources Conservation Service (NRCS) to install conservation practices on their land. A primary purpose of EQIP is to optimize the environmental benefits achieved using program funds. Managed by NRCS, EQIP is a voluntary program established in 1996 that currently provides about $1 billion annually in cost-share and incentive payments to farmers and ranchers in all 50 states, as well as U.S. territories, whose production practices may put soil, water, air, and related natural resources at risk for environmental damage.[Footnote 1] The program provides funds to help implement conservation practices, such as planting vegetation along rivers and streams--known as riparian buffers--to prevent sediment and other materials from polluting the waters, and constructing waste storage facilities to reduce the level of nutrients from livestock production that enter neighboring bodies of water. The Farm Security and Rural Investment Act of 2002 (the act) reauthorized EQIP and increased annual authorized program funding from about $200 million in 1997 to current levels of over $1 billion.[Footnote 2] NRCS allocates the majority of EQIP funds through a general financial assistance formula with 31 factors related to the availability of natural resources and the presence of environmental concerns or problems. NRCS assigns each of the formula's factors a weight that determines the funds to be allocated to states based on that factor. The agency also periodically modifies factor weights. Additional funds are distributed using a second technical assistance formula that considers ongoing and expected future conservation work, as well as through a performance bonus formula designed to reward states for optimizing environmental benefits and efficient program management.[Footnote 3] States disburse EQIP funds to producers to install conservation practices on their land. As requested, we assessed the extent to which (1) USDA's process for providing funds to the states is consistent with the program's purpose of optimizing environmental benefits and (2) USDA has developed measures to monitor program performance. To address these issues, we reviewed relevant statutory provisions and NRCS's regulations and guidelines for implementing EQIP and spoke with officials in NRCS's national headquarters. To review NRCS's efforts to allocate EQIP funding to the states, we analyzed documents accounting for NRCS's disbursements of EQIP funds. We examined the factors and weights in the formula for general financial assistance and discussed the role of the data source for each factor in the formula with NRCS's EQIP officials. We gathered comments from stakeholders about the strengths and weaknesses of NRCS's EQIP funding approach, selecting stakeholders from environmental and farm organizations to obtain a broad set of views on the effectiveness of the formula in allocating funds. To evaluate the extent to which NRCS has developed sufficient outcome-based measures to monitor program performance, we spoke with representatives from the NRCS teams responsible for strategic planning and oversight activities and representatives from the EQIP program team. We examined documentation of EQIP performance measures and reviewed NRCS's Performance Results System. A more detailed description of our objectives, scope and methodology is presented in appendix I. We performed our work between December 2005 and August 2006 in accordance with generally accepted government auditing standards. Results in Brief: NRCS's funding process is not clearly linked to EQIP's purpose of optimizing environmental benefits; as such, NRCS may not be directing EQIP funds to states with the most significant environmental concerns arising from agricultural production. NRCS's general financial assistance formula has several weaknesses that raise questions about the formula's usefulness for effectively directing funds to states. Specifically, while the 31 factors in the financial assistance formula, and the weights associated with each factor, give the formula an appearance of precision, NRCS does not have a specific, documented rationale for why it included each factor in the formula or for how it assigns and periodically adjusts factor weights. Factors and weights are important for ensuring that funds are distributed to states to address the nation's most significant environmental problems arising from agriculture. Small adjustments in the weights of the factors can shift the amount of funding directed at a particular resource concern and, ultimately, the amount of money each state receives. For example, in 2006, a 1 percent increase in the weight of any of the 31 factors would have resulted in $6.5 million more allocated on the basis of that factor at the expense of other factors. In addition, some data in the EQIP financial assistance formula is questionable or outdated. First, 5 of the data sources--such as acres of nonirrigated cropland and federal grazing land--were used in the formula more than once. Using the same data for multiple factors may result in factors being indirectly weighted more than intended and may make the formula less reliable for allocating state funding. Second, NRCS could not identify the source of the data used in 10 of the 31 factors in the formula, such as livestock animal units and animal waste generation and, therefore, we could not verify the accuracy of the data or the basis on which the agency was allocating funding. Finally, the formula does not use the most current data available for at least 6 of the 31 factors. For example, the formula uses 1995 data to measure commercial fertilizer use on cropland, but we identified 2005 data that would have made this factor more current. Because it was not clear how NRCS originally calculated this data, we could not quantify the effect of using more recent data. However, using less recent data raises questions about whether the formula allocates funds to areas of the country that currently have the greatest environmental needs. When we brought our concerns to NRCS's attention, officials agreed that the formula, including weights and data sources, needed to be reviewed. NRCS subsequently announced plans to issue a request for proposal soliciting comments and suggested revisions to NRCS's formulas for allocating conservation funds, including the EQIP financial assistance formula. As part of its 2005 strategic planning effort, NRCS developed long- term, outcome-based measures to assess changes to the environment resulting from EQIP practices. NRCS has developed baselines for these measures and plans to assess and report on them once computer models and other data collection methods that estimate environmental change are completed. In the meantime, NRCS will continue to use the results of its existing annual measures to assess performance. As NRCS collects additional data about its accomplishment of long-term performance measures, it may ultimately have more complete information on which to gauge program performance. Such information could help the agency refine its process for allocating funds to the states via its financial assistance formula by directing funds toward areas of the country that need the most improvement. We are making recommendations to the Secretary of Agriculture to better align NRCS's process for allocating EQIP funds with the program's stated purpose of optimizing environmental benefits. In particular, we are recommending that NRCS ensures that its rationale for the factors and weights is documented and linked to program priorities, its data sources are accurate and current, and it uses information about long- term program performance to ensure funds are directed to areas of the highest priority. We provided USDA with a draft of this report for review and comment. USDA agreed that the EQIP allocation formula needs review. USDA did not agree with our assessment that NRCS's funding process lacks a clear link to the program's purpose of optimizing environmental benefits. The agency stated that its use of factors related to the natural resource base and condition of those resources shows the general financial assistance formula is tied to the program's purpose of optimizing environmental benefits. USDA also stated that, while some formula data sources and weights will be updated, the types of factors used would be needed in any process that attempts to inventory and optimize environmental benefits. While this may in fact be the case, USDA needs to document this connection--that is, why factors were chosen and weights assigned. USDA could make the connection between the formula and the program's purpose of optimizing environmental benefits more evident if it provided additional information describing its reasons for including or excluding factors in the formula and its rationale for assigning and modifying weights. Background: The U.S. agricultural sector benefits our economy and the health of our nation. However, if not properly managed, agricultural activities can impair the nation's water, air, and soil; disrupt habitat for endangered species; and constrain groundwater resources. For example, sediment produced during routine agricultural activities may run off the land and reach surface waters, including rivers and lakes. Sediment can destroy or degrade aquatic habitat and can further impair water quality by transporting into area waters both the pesticides applied to cropland and the nutrients found in fertilizers and animal waste.[Footnote 4] These and other water quality issues are of concern in a number of U.S. agriculture-producing regions, including the Midwest and along the Mississippi River. Agriculture is also a major user of groundwater and surface water, which has led to water resource concerns across the country, particularly in the West. In 2000, irrigation accounted for 65 percent of the nation's consumption of fresh water. Agricultural production can also impair air quality, when wind carries eroded soil, odors, and smoke, and may lead to the loss of wetlands, which provide wildlife habitat, filter pollutants, retain sediment, and moderate hydrologic extremes. EQIP is one of a number of USDA conservation programs designed to mitigate agriculture's potentially negative environmental effects. EQIP provides cost-share funds and incentive payments for land used for agricultural production and supports around 190 conservation practices, including constructing facilities to temporarily store animal waste; planting rows of trees or shrubs to reduce wind erosion and provide food for wildlife; and planning the amount, form, placement, and timing of the application of plant nutrients. EQIP is designed to fund conservation practices in a manner that helps the program achieve the following national priorities identified by NRCS: * reducing nonpoint source pollution (nutrients, sediment, pesticides, or excess salinity), groundwater contamination, and pollution from point sources (such as concentrated animal feeding operations); * conserving groundwater and surface water resources; * reducing emissions that contribute to air quality impairment; * reducing soil erosion from unacceptable levels on agricultural land; and: * promoting at-risk species habitat conservation. The Federal Agriculture Improvement and Reform Act of 1996 created EQIP by combining four existing conservation programs into a single program.[Footnote 5] The Farm Security and Rural Investment Act of 2002, the farm bill, reauthorized EQIP and increased its authorized funding from about $200 million in 1997 to current levels of over $1 billion.[Footnote 6] The 2002 act required that at least 60 percent of EQIP funds be made available for conservation practices relating to livestock production.[Footnote 7] In addition, it authorized EQIP funds for specific conservation purposes--(1) funds for producers to install water conservation practices to improve groundwater and surface water conservation (the Ground and Surface Water Conservation component of EQIP) and (2) funds for water conservation practices in the Klamath Basin located on the California/Oregon border (the Klamath Basin component of EQIP).[Footnote 8] Annually, NRCS headquarters officials determine the amount of funding each state receives, while state and local NRCS officials decide what conservation practices to fund in their state and local communities. The total amount of EQIP funding a state receives can be derived by adding together that state's funding for all categories. Table 1 describes the different categories of funding that states received for fiscal year 2006 and NRCS's process for allocating that funding. Table 1: Fiscal Year 2006 Categories of EQIP Funding: EQIP funding category: General financial assistance; Funding purpose: Cost-share and incentive payments for installing conservation practices; Process for allocating funding: Funds are divided among states using a 31-factor formula that considers the presence of available natural resources and environmental concerns in each state. Each factor is assigned a weight, which determines the amount of money to be given to states based on that factor; Percentage of total funding: 65%. EQIP funding category: General technical assistance; Funding purpose: Funds for technical specialists' time. Among other activities, specialists process EQIP administrative paperwork, advise farmers about the installation of practices, and inspect installed practices; Process for allocating funding: Technical assistance dollars are divided among states based on the number of ongoing EQIP contracts and expected future technical specialist needs; Percentage of total funding: 19. EQIP funding category: Ground and Surface Water Conservation[A]; Funding purpose: Funds for conservation practices that improve groundwater and surface water conservation. Practices must result in a net savings of groundwater or surface water resources; Process for allocating funding: Groundwater and surface water funds are allocated to eight High Plains Aquifer states, nine western drought states, and other states with agricultural water needs using a formula based on groundwater, irrigation, and other agricultural water usage factors; Percentage of total funding: 7. EQIP funding category: Performance incentive bonuses[A]; Funding purpose: Bonuses designed to reward states that achieve a high level of program efficiency and optimize environmental benefits. States can use bonuses as they do other EQIP financial and technical assistance; Process for allocating funding: Performance bonuses are divided among states using a formula with seven factors; Percentage of total funding: 4. EQIP funding category: EQIP Colorado Salinity[A]; Funding purpose: Funds for salinity control measures in the Colorado River Basin; Process for allocating funding: Colorado Salinity dollars are divided between Colorado, Utah, and Wyoming based on the amount of land in each state needing salinity control treatment; Percentage of total funding: 2. EQIP funding category: EQIP regional equity[A]; Funding purpose: Funds provided to states that receive less than $12 million from NRCS conservation programs (including EQIP) in a given fiscal year.[B] States can use funds as they do other EQIP financial and technical assistance; Process for allocating funding: Regional equity funds are provided to states that receive less than $12 million from NRCS conservation programs (including EQIP) in a given fiscal year.[B] Headquarters officials determine the amount of funds to be provided to each state and from which program the funds will come; Percentage of total funding: 2. EQIP funding category: Klamath Basin[A]; Funding purpose: Funds to carry out water conservation activities in the Klamath Basin in California and Oregon; Process for allocating funding: Klamath Basin funding is split evenly between California and Oregon; Percentage of total funding: 1%. Source: GAO analysis of NRCS documentation. Note: EQIP funds are also provided to producers through Conservation Innovation Grants, funds competitively awarded for the development and adoption of innovative conservation approaches and technologies. In fiscal year 2006, around $20 million in grants was approved by NRCS. Conservation Innovation Grants are awarded through national and state competitions to producers demonstrating innovative approaches to conservation. Because the grant money for national competitions is not provided to states along with their initial EQIP allocations, it is not reflected in this table. [A] NRCS provides these funds to the states through both financial and technical assistance; the majority of the assistance is in the form of financial assistance. [B] In fiscal year 2006, the threshold was lowered administratively to $11 million. [End of table] As the table shows, each category of EQIP funding is allocated to the states using a different process. For the general financial assistance formula, the availability of natural resources accounts for approximately half of the funds allocated, and the presence of environmental concerns or problems accounts for the remainder.[Footnote 9] Table 2 shows the factors and weights used in the financial assistance formula for fiscal year 2006. Table 2: EQIP General Financial Assistance Formula Factors and Weights, Fiscal Year 2006: Factor[A]: Acres of nonirrigated cropland; Weight: 3.2. Factor[A]: Acres of irrigated cropland; Weight: 4.3. Factor[A]: Acres of federal grazing lands; Weight: 0.5. Factor[A]: Acres of nonfederal grazing lands; Weight: 4.3. Factor[A]: Acres of forestlands; Weight: 1.1. Factor[A]: Acres of specialty cropland; Weight: 3.2. Factor[A]: Acres of wetlands and at-risk species habitat; Weight: 4.6. Factor[A]: Acres of bodies of water; Weight: 3.2. Factor[A]: Livestock animal units[B]; Weight: 5.8. Factor[A]: Animal waste generation; Weight: 5.8. Factor[A]: Waste management capital cost; Weight: 3.5. Factor[A]: Acres of American Indian tribal lands; Weight: 3.3. Factor[A]: Number of limited resource producers; Weight: 5.0. Factor[A]: Acres of grazing land lost to conversion; Weight: 0.8. Factor[A]: Air quality nonattainment areas; Weight: 1.4. Factor[A]: Acres of pastureland needing treatment; Weight: 5.5. Factor[A]: Acres of cropland eroding above T[C]; Weight: 6.2. Factor[A]: Acres of fair and poor rangeland; Weight: 6.2. Factor[A]: Acres of forestlands eroding above T[C]; Weight: 1.4. Factor[A]: Acres of cropland and pastureland soils affected by saline and/or sodic conditions[D]; Weight: 2.6. Factor[A]: Miles of impaired rivers and streams; Weight: 3.6. Factor[A]: Potential for pesticide and nitrogen leaching; Weight: 1.3. Factor[A]: Potential for pesticide and nitrogen runoff; Weight: 1.7. Factor[A]: Ratio of livestock animal units to cropland; Weight: 1.7. Factor[A]: Number of concentrated animal feeding operations/animal feeding operations[E]; Weight: 2.8. Factor[A]: Ratio of commercial fertilizers to cropland; Weight: 0.9. Factor[A]: Wind erosion above T[C]; Weight: 4.2. Factor[A]: Phosphorous runoff potential; Weight: 3.9. Factor[A]: Riparian areas; Weight: 0.8. Factor[A]: Carbon sequestration; Weight: 3.6. Factor[A]: Coastal zone land; Weight: 3.6. Source: NRCS. [A] The factor names in this chart are NRCS terminology. In certain cases, they may not represent what is actually being measured. For example, the factor for acres of cropland and pastureland soils affected by saline and/or sodic conditions only measures the presence of salts on cropland and pastureland and does not include data on the presence of sodium on these lands. [B] Animal units are a standard way of quantifying livestock of different types and sizes (e.g., cattle, dairy, poultry, etc.) One animal unit is equivalent to 1,000 pounds of live animal weight. [C] T is a term that refers to a tolerable rate of erosion. T is the maximum rate of annual soil loss that will permit crop productivity to be sustained economically and indefinitely on a given soil. [D] Saline and sodic soils are soils that contain salts and sodium. Excess amounts of salt and sodium in soils may adversely affect soil quality and crop productivity. [E] Animal feeding operations are facilities where animals are raised in confined or semiconfined situations usually with feed brought to the animals. When large enough or when in environmentally sensitive locations, these facilities are designated as concentrated animal feeding operations and become subject to regulatory requirements to prevent point source pollution. [End of table] In fiscal year 2006, approximately $652 million was divided among the states through the general financial assistance formula.[Footnote 10] For example, according to the formula, EQIP funding for nonirrigated cropland (accounting for 3.2 percent of financial assistance) totaled $20.9 million. The state with the most acres of nonirrigated cropland received $1.7 million of the funds associated with this factor, and the state with the fewest acres of nonirrigated cropland received approximately $1,100. A state's total allocation is composed of the funds it receives for each of the 31 factors. Although about 65 percent of EQIP funds are provided through the general financial assistance formula, other categories of funding can have a significant effect on the total amount of funds an individual state receives. For example, 35 percent of Utah's fiscal year 2006 allocation was from general financial assistance. The largest category of EQIP funds Utah received--38 percent--was Colorado Salinity funds. Appendix II provides additional information on the 2006 funding allocation formulas for general financial assistance, Ground and Surface Water Conservation, performance incentive bonuses and Klamath Basin funding categories. Figure 1 shows the initial distribution of NRCS's fiscal year 2006 EQIP allocations to the states in November 2005. States had to return any unused funds by June 2006 for redistribution to states with a need for additional funds. Appendix IV describes the amount of funding each state initially received in fiscal year 2006. Figure 1: Initial EQIP Funding to States, Fiscal Year 2006: [See PDF for image] - graphic text: Source: Art Explosion (map); GAO analysis of NRCS documentation. [End of figure] - graphic text: NRCS's Process for Allocating EQIP Funds to the States Does Not Clearly Address the Program's Purpose of Optimizing Environmental Benefits: NRCS's process for providing EQIP funds to the states is not clearly linked to the program's purpose of optimizing environmental benefits. In particular, NRCS's general financial assistance formula, which accounts for approximately two-thirds of funding provided to the states, does not have a specific, documented rationale for each of the formula's factors and weights. In addition, the financial assistance formula relies on some questionable and outdated data. As a result, NRCS may not be directing EQIP funds to states with the most significant environmental concerns arising from agricultural production. NRCS Does Not Have A Specific, Documented Rationale for Formula Factors and Weights: Although the 31 factors and weights used in the general financial assistance formula give it an appearance of precision, NRCS does not have a clearly documented rationale for including each factor in the formula and assigning or modifying each weight. The original EQIP formula was created in 1997 by an interagency task force that modified the formula created for a different conservation program--the Conservation Technical Assistance Program.[Footnote 11] The task force added and deleted factors and adjusted factor weights so that the EQIP formula better corresponded to the Federal Agriculture Improvement and Reform Act of 1996's requirement that 50 percent of funds be targeted at funding livestock-related practices. Since the creation of the financial assistance formula, NRCS has periodically modified factors and weights to emphasize different program elements and national priorities, most recently in fiscal year 2004 following the passage of the 2002 Farm Security and Rural Investment Act. Furthermore, NRCS officials stated that they meet annually to review the allocation of funds to states. However, throughout this process, NRCS has not documented the basis for its decisions to modify factors and weights or documented how changes to its formula achieve the program's purpose of optimizing environmental benefits. Thus, it is not always clear whether the formula factors and weights guide funds to the states as effectively as possible. For example, it is unclear why NRCS includes a factor in the formula that addresses the waste management costs of small animal feeding operations but not a factor that addresses such costs for large operations--large operations can also damage the environment and are eligible for EQIP funding.[Footnote 12] By not including the costs of the larger operations in its financial assistance formula, some states may not be receiving funds to address their specific environmental concerns. In addition, NRCS has not demonstrated that it has the most appropriate water quality factors in its formula. For example, the formula includes a factor addressing river and stream impairment but no factor for impaired lakes and other bodies of water. Moreover, it is not certain whether the impaired rivers and streams factor results in funds being awarded on the basis of general water quality concerns or water pollution specifically caused by agricultural production. As a result, it was not certain whether the formula allocates funds as effectively as possible to states with water quality concerns arising from agricultural production. While the factors in the EQIP general financial assistance formula determine what resource and environmental characteristics are considered when allocating funds, the weights associated with these factors directly affect how much total funding is provided for each factor and, thus, the amount of money each state receives. Factors and weights are key to ensuring states with the greatest environmental problems receive funding to address these problems. Small differences in the weights of the factors can shift the amount of financial assistance directed at a particular resource concern and, ultimately, the amount of money provided to a state. In 2006, if the weight of any of the 31 factors had increased by 1 percent, $6.5 million would have been allocated on the basis of that factor at the expense of one or more other factors. Such a shift could impact the amount of financial assistance received by each state. For example, a 1 percent increase in the weight of the specialty cropland factor with a corresponding decrease of 1 percent in the American Indian tribal land factor could result in large changes to the distribution of EQIP general financial assistance. According to our analysis, the state benefiting the most from such a change would receive $2.6 million more (a 7.2 percent increase in that state's level of general financial assistance) and the state benefiting least from such a change would lose $2.7 million (a 13.5 percent decrease in that state's level of general financial assistance). The potential for the weights to significantly affect the amount of funding a state receives underscores the importance of having a well-founded rationale for assigning them. To date, NRCS has not documented its rationale for choosing the weights. Some stakeholders we spoke with questioned NRCS's assignment of weights to certain factors in the financial assistance formula because they did not believe NRCS's formula adequately reflected the states' environmental priorities. For example, NRCS's general financial assistance formula allocates 6.3 percent of EQIP funds to the states based on factors specifically associated with animal feeding operations.[Footnote 13] However, states spent more of their EQIP financial assistance on related practices, which suggests that the weights in the financial assistance formula may not reflect states' priorities. In fiscal year 2005, states spent a total of 11 percent of EQIP financial assistance, or $91.1 million, on one such practice--the construction of waste storage facilities for animal feeding operations. (App. VI outlines the practices funded in fiscal year 2005, including other practices to control pollution from animal feeding operations.) More generally, other stakeholders said that, as the program develops, NRCS should give additional weight to factors related to the presence of environmental concerns in a state and place less emphasis on factors related to natural resources in a state. They believed this reassignment of weights would better ensure that states contending with the most significant environmental problems receive the most funding. Currently, factors related to the presence of environmental concerns account for approximately half of the total funding, while factors relating to the availability of natural resources account for the remainder. Factors related to the availability of natural resources provide states that have significant amounts of a particular type of land--such as grazing land or cropland--with more funds, regardless of whether that land is impaired. Although NRCS has stated that it meets annually to review its allocation of funds to states, officials told us they had not conducted any statistical analysis to examine the influence of factors on funding outcomes. Statistical analyses can provide information on how the factors in the allocation formula have affected the distribution of funds, thereby providing information to improve program implementation.[Footnote 14] To better understand the effect of the factors on the allocations to states, we used two types of statistical analysis to assess the effects of the EQIP financial assistance formula on state funding: (1) regression analysis to show which factors are the most influential in determining funding levels and (2) factor analysis to understand how factors can be grouped and identified with program priorities. Our regression analysis for the fiscal year 2006 funding allocation shows that the factors that were the most important in explaining the distribution of general financial assistance to states were acres of fair and poor rangeland, acres of nonfederal grazing lands, livestock animal units, acres of irrigated cropland, acres of American Indian tribal lands, and wind erosion above T. This analysis suggests that regions of the country with these types of characteristics are more likely to benefit from the current formula. On the other hand, a few factors, such as acres of forestlands, potential for pesticide and nitrogen leaching, and air quality nonattainment areas were not significantly related to the allocation, indicating that they had little or no impact on the formula. Our factor analysis, which groups the data into a smaller number of categories that actually drive the formula, found that the largest grouping with the greatest amount of correlation, included acres of nonfederal grazing land, acres of fair and poor rangeland, livestock animal units, and wind erosion above T--all indicative of dryland agriculture and livestock feeding and ranching. These results correspond with those of our regression analysis and help to show how the current national allocation formula prioritizes money to states. A complete explanation of both analyses is included in appendix III. Financial Assistance Formula Relies on Some Questionable and Outdated Data: Weaknesses in the financial assistance formula are compounded by NRCS's use of questionable and outdated data. Accurate data are key to ensuring that funds are distributed to states as intended. However, we identified several methodological weaknesses in the data sources: (1) data that were used more than once in the formula, (2) data sources whose accuracy could not be verified, and (3) data that was not as recent as possible. First, 5 of the 29 data sources behind the factors in the financial assistance formula were used more than once, potentially causing NRCS to overemphasize some environmental concerns at the expense of others. Specifically: * NRCS uses the same data to estimate pesticide and nitrogen runoff and phosphorous runoff in its formula. According to NRCS, because data measuring the potential for phosphorous runoff were unavailable, it substituted data measuring the potential for pesticide and nitrogen runoff. The agency did so believing that similar characteristics cause both types of runoff. However, an NRCS official responsible for deriving the runoff and leaching indicators commented that the substitution of one type of runoff data for another was problematic because the mechanisms through which pesticides and nitrogen are transported off-site to cause environmental problems are different from those of phosphorous. A 2006 NRCS cropland report estimates that the intensity of nitrogen and phosphorous losses may differ geographically.[Footnote 15] For example, nitrogen dissolved in surface water runoff in the upper Midwest accounts for 28 percent of the national total, while phosphorous dissolved in surface water runoff in the same region accounts for 45 percent of the national total. This difference in the effect of these two pollutants in the same region raises questions about the appropriateness of substituting one type of data for the other. Until adequate data are available for a given factor, it may not be appropriate to include that factor in the general financial assistance formula. * NRCS's formula uses nonirrigated cropland, federal grazing land, nonfederal grazing land, and forestland once for estimating acreage and then again for estimating carbon sequestration.[Footnote 16] According to NRCS, the agency did not have good source data to measure potential areas where management practices could improve levels of carbon sequestration so it substituted these other data sources. While we could not fully assess the soundness of NRCS's estimate of carbon sequestration, some academic stakeholders we spoke with questioned whether NRCS had estimated carbon sequestration as effectively as possible and noted that alternate data sources were available. In discussing these alternate sources with NRCS, the EQIP Manager said the agency had not previously considered using these sources for the EQIP formula, but that they could prove relevant. Using the same data for multiple factors may result in factors being indirectly weighted higher than intended. For example, the effective weight of the pesticide nitrogen runoff factor is 5.6 percent--the sum of the original pesticide nitrogen runoff weight (1.7 percent) and the phosphorous runoff weight (3.9 percent). Using data created for one factor for a second factor also makes the formula less transparent and potentially less reliable for allocating state funding. Second, NRCS could not confirm the source of data used in 10 factors in the formula; as such, we could not determine the accuracy of the data, verify how NRCS generated the data, or fully understand the basis on which the agency allocates funding. Specifically, we could not confirm the source of data for acres of federal grazing land, livestock animal units, animal waste generation, acres of cropland eroding above T, acres of forestlands eroding above T, ratio of animal units to cropland, miles of impaired rivers and streams, ratio of commercial fertilizers to cropland, riparian areas, and coastal zone land.[Footnote 17] For example, we could not verify how data for the livestock animal units and animal waste factors were generated, and NRCS said it had not retained documentation of how the data for these factors were calculated. As a result, it was uncertain whether NRCS had chosen the most appropriate data as its basis for allocating funds to states with pollution problems from livestock and animal waste or whether the data were accurately calculated. EQIP officials told us that, in most cases, the data sources had been chosen and incorporated into the formula before they were involved with EQIP and that documentation had not been kept to identify how data sources were used. In addition, for one factor--the number of limited resource producers in a state--we found that the data did not measure what its factor name indicated. NRCS defines a limited resource producer as one who had, for the last 2 years, (1) farm sales not more than $100,000 and (2) a household income at or below the poverty level, or less than 50 percent of the county median household income.[Footnote 18] However, the data NRCS uses in the general financial assistance formula only captures farms with low sales, which does not necessarily indicate whether producers on those farms have limited means. As a result, NRCS may not be directing funds to states having farmers with the most limited resources. A description of each factor in the fiscal year 2006 general financial assistance formula can be found in appendix II. Third, NRCS does not use the most current data for six factors in the formula--livestock animal units, animal waste generation, number of limited resource producers, miles of impaired rivers and streams, ratio of livestock animal units to cropland, and ratio of commercial fertilizers to cropland.[Footnote 19] According to NRCS, the source of data on the ratio of commercial fertilizers to cropland was a 1995 report by the Association of American Plant Food Control Officials; we found a 2005 version of the same report with more current data. In other cases, we identified more current, alternate sources of data. For example, the formula currently uses 1996 EPA data for its waste management capital cost factor but could use 2003 NRCS data that estimates waste management costs.[Footnote 20] Not using recent data raises questions about whether the formula allocates funds to areas of the country that currently have the greatest environmental needs, because recent changes in a state's agricultural or environmental status may not be reflected. According to our analysis, by using more current data for the number of limited resource producers factor, one state would have received approximately $151,000 more in fiscal year 2006 (a 0.2 percent increase in that state's general financial assistance), and another state would have received approximately $138,000 less (a 1.3 percent decrease in that state's general financial assistance).[Footnote 21] Because we were unable to determine how NRCS used the data for developing the remaining five factors, we could not determine what impact using more current data for those factors would have on financial assistance provided to states. According to NRCS, the alternate sources we identified appeared to be acceptable for use in the formula, and the agency is in the process of updating the formula's livestock data. In addition to these six factors, data used to measure acres of riparian areas, fair and poor rangeland, and forestland eroding above T are about 20 years old and will likely become more inappropriate over time. When we brought our concerns to NRCS's attention, officials agreed that the formula, including weights and data sources, needed to be reexamined. NRCS subsequently announced plans to issue a request for proposal soliciting comments and suggested revisions to NRCS's formulas for allocating conservation funds, including the EQIP financial assistance formula. In addition, according to NRCS's EQIP Manager, the agency is in the process of consolidating the data used in the financial assistance formulas for its conservation programs into a single database. As a part of this process, the agency plans to review its data sources for the formula factors and update them with more relevant and current data when possible. NRCS Has Begun to Develop More Outcome-Oriented Performance Measures: NRCS has recently begun to develop program-specific, long-term measures to monitor EQIP's outcomes. In 2000, we reported that performance measures tied to outcomes would better communicate the results NRCS intended its conservation programs to achieve.[Footnote 22] As part of its 2005 strategic planning effort, NRCS developed outcome-based, long- term measures to assess changes to the environment resulting from the installation of EQIP conservation practices.[Footnote 23] These measures include such things as reduced sediment delivery from farms, improved soil condition on working cropland, and increased water conservation. Previously, in 2002, NRCS established annual measures that primarily assess program outputs--the number and type of conservation practices installed. Table 3 outlines NRCS's seven annual performance measures for fiscal year 2006, and table 4 describes its seven long-term EQIP performance measures approved in 2005. Table 3: EQIP Annual Performance Measures, Fiscal Year 2006: Performance measure: Comprehensive nutrient management plans applied; Measure unit: Number of plans; Progress as of September 1, 2006: 2,189; Fiscal year target as of September 1, 2006[A]: 2,488. Performance measure: Comprehensive nutrient management plans written; Measure unit: Number of plans; Progress as of September 1, 2006: 2,231; Fiscal year target as of September 1, 2006[A]: 2,435. Performance measure: Grazing land with conservation practices to protect the resource base; Measure unit: Acres; Progress as of September 1, 2006: 11,640,329; Fiscal year target as of September 1, 2006[A]: 10,454,337. Performance measure: Improved irrigation efficiency; Measure unit: Acre-feet; Progress as of September 1, 2006: 641,158[B]; Fiscal year target as of September 1, 2006[A]: 543,204[C]. Performance measure: Nonfederal land managed to protect species with declining populations; Measure unit: Acres; Progress as of September 1, 2006: 1,163,850; Fiscal year target as of September 1, 2006[A]: 381,124. Performance measure: Reduction of cropland soils damaged by erosion; Measure unit: Acres; Progress as of September 1, 2006: 1,345,101; Fiscal year target as of September 1, 2006[A]: 1,360,622. Performance measure: Soil erosion reduced; Measure unit: Tons; Progress as of September 1, 2006: 16,230,336; Fiscal year target as of September 1, 2006[A]: 9,912,788. Source: NRCS. [A] According to NRCS, performance targets may change as additional funds are provided to the states and as states return unused funds to headquarters. [B] This figure represents combined progress for EQIP, Ground and Surface Water Conservation, and Klamath Basin. [C] This figure represents a combined target for EQIP, Ground and Surface Water Conservation, and Klamath Basin. [End of table] Table 4: EQIP Long-term Measures: Performance measure: Improve soil condition on working cropland; Measure unit: Millions of acres moved to a soil conditioning index level > than 0.[A]; Baseline year: .5 in 2005; Proposed target: 2.7 by 2010. Performance measure: Reduce potential sediment delivery from agricultural operations; Measure unit: Million tons per year; Baseline year: 2.4 in 2004; Proposed target: 18.5 by 2010. Performance measure: Reduce potential nitrogen delivery from agriculture; Measure unit: Tons; Baseline year: 18,200 in 2005; Proposed target: 100,000 by 2010. Performance measure: Reduce potential phosphorus delivery from agriculture; Measure unit: Tons; Baseline year: 2,700 in 2005; Proposed target: 14,000 by 2010. Performance measure: Increase water conservation; Measure unit: Acre- feet; Baseline year: 600,000 in 2005; Proposed target: 4,200,000 by 2010. Performance measure: Improve grassland condition, health, and productivity; Measure unit: Million acres; Baseline year: 10.3 in 2005; Proposed target: 52 by 2010. Performance measure: Improve the quality of habitat for at-risk species; Measure unit: Million acres; Baseline year: .45 million in 2005; Proposed target: 2.4 by 2010. Source: NRCS. [A] The National Resources Inventory (NRI) includes data on soil type, soil characteristics, and soil interpretations, in addition to historical information on land use, management practices, and erosion. These data, along with historical climate data, are being used to assess soil quality by deriving a Soil Conditioning Index value for each NRI sample site. This index quantifies the effects of cropping sequences, tillage, and other management inputs on soil organic matter content, which serves as an indicator of soil quality. [End of table] According to NRCS, it has developed baselines for its long-term, outcome-based performance measures and plans to assess and report on them once computer models and other data collection methods that estimate environmental change are completed. The Director of the NRCS Strategic Planning and Performance Division said NRCS expects to assess and report on the status of all measures by 2010 but will be able to assess the results of some measures, such as improved soil condition on working land, sooner. In the meantime, the agency will continue to utilize its existing annual measures to assess performance. The Director of NRCS's Strategic Planning and Performance Division acknowledged that the long-term measures were not as comprehensive as needed but represented measures NRCS could reasonably assess using modeling and data collection methods that would soon become available. NRCS plans to continue to improve its performance measures going forward. Although we did not assess the comprehensiveness of the EQIP performance measures, the additional information they provide about the results of EQIP outcomes should allow NRCS to better gauge program performance. Such information could also help the agency refine its process for allocating funds to the states via its financial assistance formula by directing funds toward practices that address unrealized performance measures and areas of the country that need the most improvement. The Chief of NRCS's Environmental Improvement Programs Branch agreed that information about program performance might eventually be linked back to the EQIP funding allocation process. However, the agency does not yet have plans to do so. Conclusions: As a key NRCS conservation program with over $1 billion in annual funding, EQIP was designed to help producers mitigate the potentially negative environmental impacts of agricultural production. However, the program may not be fully optimizing the environmental benefits resulting from practices installed using EQIP dollars because of weaknesses in NRCS's process for allocating funds to the states. Moreover, outdated and duplicate formula data sources may further compromise EQIP's effectiveness in allocating funds. Currently, it is not clear that factors, weights, and data sources in the general financial assistance formula help the agency direct funding to the areas of the nation with the greatest environmental threats arising from agricultural production. NRCS has an opportunity to address this issue as it moves forward on its plans to reexamine its conservation funding formulas. Furthermore, the agency may be able to use information gathered from the results of its outcome-based performance measures to refine the financial assistance formula, making it easier for NRCS to direct EQIP funds at the most pressing environmental problems related to agriculture production. Recommendations for Executive Action: To achieve EQIP's purpose of optimizing environmental benefits, we recommend that the Secretary of Agriculture direct the Chief of the Natural Resources Conservation Service to take the following two actions: * ensure that the rationale for the factors and weights used in the general financial assistance formula are documented and linked to program priorities, and data sources used in the formula are accurate and current; and: * continue to analyze current and newly developed long-term performance measures for the EQIP program and use this information to make any further revisions to the financial assistance formula to ensure funds are directed to areas of highest priority. Agency Comments and Our Evaluation: We provided USDA with a draft of this report for review and comment. USDA agreed that the EQIP allocation formula needs review. USDA did not agree with our assessment that NRCS's funding process lacks a clear link to the program's purpose of optimizing environmental benefits. The agency stated that its use of factors related to the natural resource base and condition of those resources shows the general financial assistance formula is tied to the program's purpose of optimizing environmental benefits. USDA stated that, while some formula data sources and weights will be updated, the types of factors used would be needed in any process that attempts to inventory and optimize environmental benefits. While this may in fact be the case, USDA needs to document this connection--that is, why factors were chosen and weights assigned. USDA could make the connection between the formula and the program's purpose of optimizing environmental benefits more evident if it provided additional information describing its reasons for including or excluding factors in the formula and its rationale for assigning and modifying weights. Appendix VII presents USDA's comments. We are sending copies of this report to interested congressional committees, the Secretary of Agriculture, the Director of the Office of Management and Budget, and other interested parties. We also will make copies available to others upon request. In addition, the report will be available at no charge on the GAO Web site at [Hyperlink, http://www.gao.gov]. If you or your staff have any questions about this report, please contact me at (202) 512-3841 or bertonid@gao.gov. Contact points for our Offices of Congressional Relations and of Public Affairs may be found on the last page of this report. GAO staff who made major contributions to this report are listed in appendix VIII. Sincerely yours, Signed by: Daniel Bertoni: Acting Director, Natural Resources and Environment: [End of section] Appendix I: Objectives, Scope, and Methodology: At the request of the Ranking Democratic Member, Senate Committee on Agriculture, Nutrition, and Forestry, we reviewed the extent to which (1) the U.S. Department of Agriculture's (USDA) process for allocating Environmental Quality Incentives Program (EQIP) funds to states is consistent with the program's purpose of optimizing environmental benefits and (2) USDA has developed measures to monitor program performance. To review the Natural Resources Conservation Service's (NRCS) process for allocating EQIP funding to the states, we examined EQIP funding documents and spoke with NRCS officials from the Financial Assistance Program Division, Budget Planning and Analysis Division, and Financial Management Division. Our analysis considered each of the different categories of EQIP funding, including EQIP general financial assistance, EQIP technical assistance, regional equity funds, performance bonuses, Conservation Innovation Grants, Colorado Salinity funds, Ground and Surface Water Conservation funds, and Klamath Basin funds. We gathered comments from stakeholders about the strengths and weaknesses of NRCS's EQIP funding approach. We selected stakeholders from environmental and farm organizations to get a broad set of views on the effectiveness of the formula in allocating funds. Specifically, we spoke with representatives from environmental organizations, including Environmental Defense, the National Association of Conservation Districts, the Soil and Water Conservation Society, and the Sustainable Agriculture Coalition, as well as farm organizations, including the American Farm Bureau and the National Pork Producers Council. We also discussed the EQIP funding allocation process with selected participants on state technical committees--the Iowa Department of Natural Resources, Iowa Farm Bureau, and Nebraska Department of Environmental Quality; academic stakeholders; and former NRCS employees who participated in the development of the original formula.[Footnote 24] We examined the factors and weights in the financial assistance formula and discussed their purpose with EQIP program officials. We performed statistical analysis of the financial assistance formula to determine what impact the different factors had on overall funding. A discussion of the analysis we performed can be found in appendix III. We searched for information about the source of data for each factor in the formula in order to formulate an understanding of what each factor measured and verify the accuracy of the data being used by NRCS. NRCS did not retain documentation of the source data for 10 factors and, as a result, we were unable to verify all data used in the financial assistance formula. To estimate the number of factors using outdated data, we searched for more updated versions of the same data sources NRCS said it used in its formula. We did not include more updated, but different, sources of data in our count. To understand Congress's and NRCS's goals for EQIP, we reviewed the Federal Agriculture Improvement and Reform Act of 1996, Farm Security and Rural Investment Act of 2002, associated regulations, and related appropriations laws. We reviewed program documentation describing the purpose and priorities of EQIP and discussed the documentation with EQIP officials. To understand agency conservation priorities, we analyzed a 2005 database of conservation practices funded using EQIP, Ground and Surface Water Conservation, and Klamath Basin funds. To determine how the factors and weights in the formula aligned with resource concerns across the nation, we conducted research on the impact agricultural production has on the environment. We spoke with NRCS officials from selected states--Iowa, Maryland, Mississippi, Missouri, Montana, Nebraska, New Mexico, Rhode Island, and Texas--to better understand resource concerns important to their state and how they used funds received from headquarters to address those concerns. We also spoke with officials from three county offices within these states. This geographically diverse group included states that received varying amounts of EQIP funding and engaged in a range of types of agricultural production. To review what measures are in place to monitor EQIP program performance, we spoke with representatives from the NRCS teams responsible for strategic planning and oversight activities--the Operations Management and Oversight Division, Oversight and Evaluation staff, and Strategic and Performance Planning Division--and representatives from the Financial Assistance Program Division. We examined agency strategic planning and performance documents. We reviewed documentation of agency and EQIP goals and performance measures and reviewed the Web-based NRCS Performance Results System.[Footnote 25] We also spoke with representatives from NRCS and nongovernmental organizations working on the Conservation Effects Assessment Project and reviewed related documentation to determine how that initiative might influence the development of future EQIP goals. Our analysis did not include an independent verification of NRCS's compliance with internal controls.[Footnote 26] We performed our work between December 2005 and August 2006 in accordance with generally accepted government auditing standards. [End of section] Appendix II: EQIP 2006 Funding Allocation Formulas: Tables 5, 6, 7, and 8, respectively, describe the formulas for allocating general financial assistance, Ground and Surface Water Conservation funds, performance bonuses, and Klamath Basin funds. In the case of the general financial assistance formula, we have identified the source of data for each factor and described what each factor measures. Table 5: Factors, Data Sources, and Weights in the EQIP General Financial Assistance Formula for Allocating Funding to the States in Fiscal Year 2006: Factor: Acres of nonirrigated cropland; Source: 1997 National Resources Inventory (Revised December 2000); Description: Nonirrigated cultivated and noncultivated cropland acres; Weight: 3.2%. Factor: Acres of irrigated cropland; Source: 1997 National Resources Inventory (Revised December 2000); Description: Irrigated cultivated and noncultivated cropland acres; Weight: 4.3. Factor: Acres of federal grazing lands; Source: [A]; Description: [B]; Weight: 0.5. Factor: Acres of nonfederal grazing lands; Source: 1997 National Resources Inventory (Revised December 2000); Description: Nonfederal, rural acres of pastureland, rangeland, and grazed forestland; Weight: 4.3. Factor: Acres of forestlands; Source: 1997 National Resources Inventory (Revised December 2000); Description: Nonfederal, rural acres of forestland; Weight: 1.1. Factor: Acres of specialty cropland; Source: 1997 National Resources Inventory (Revised December 2000); Description: Acres of land used as vineyards or to grow fruits, nuts, berries, bush fruit, or other specialty crops; Weight: 3.2. Factor: Acres of wetlands and at-risk species habitat; Source: 1997 National Resources Inventory (Revised December 2000); Description: Acres of wetlands and deepwater habitats on water areas and nonfederal land; Weight: 4.6. Factor: Acres of bodies of water; Source: 1997 National Resources Inventory (Revised December 2000); Description: Surface area (in acres) of water areas; Weight: 3.2. Factor: Livestock animal units; Source: 1997 NRCS calculation based on data gathered prior to 1997 (exact year unknown)[C]; Description: [B]; Weight: 5.8. Factor: Animal waste generation; Source: NRCS calculation based on 1987 Census of Agriculture and other data[C]; Description: [B]; Weight: 5.8. Factor: Waste management capital cost; Source: 1996 Environmental Protection Agency Clean Water Needs Survey Report to Congress; Description: Modeled estimates of state needs for controlling nonpoint source pollution from confined animal facilities with fewer than 1,000 animal units; Weight: 3.5. Factor: Acres of American Indian tribal lands; Source: 1997 Bureau of Indian Affairs data; Description: Acres of American Indian reservations and Tribal Trust Land; Weight: 3.3. Factor: Number of limited resource producers; Source: 1997 Census of Agriculture; Description: Number of farms with sales under $100,000; Weight: 5.0. Factor: Acres of grazing land lost to conversion; Source: 1997 National Resources Inventory (Revised December 2000); Description: Acres of grazing and pastureland converted to another form of land or development between 1982 and 1997; Weight: 0.8. Factor: Air quality nonattainment areas; Source: NRCS analysis of 2005 Environmental Protection Agency air quality data; Description: Measure of air quality nonattainment based on the percent of a state affected by certain air quality pollutants and the number of air quality standards not met by that state; Weight: 1.4. Factor: Acres of pastureland needing treatment; Source: 1992 National Resources Inventory; Description: Acres of pastureland needing conservation treatment; Weight: 5.5. Factor: Acres of cropland eroding above T; Source: 1992 National Resources Inventory[C]; Description: [D]; Weight: 6.2. Factor: Acres of fair and poor rangeland; Source: 1987 National Resources Inventory; Description: Acres of rangeland in fair and poor condition; Weight: 6.2. Factor: Acres of forestlands eroding above T; Source: 1987 National Resources Inventory[E]; Description: [F]; Weight: 1.4. Factor: Acres of cropland and pastureland soils affected by saline and/ or sodic conditions; Source: 1997 National Resources Inventory (Revised December 2000); Description: Acres of cultivated and noncultivated cropland and pastureland with the presence of salts; Weight: 2.6. Factor: Miles of impaired rivers and streams; Source: Environmental Protection Agency 1994 National Water Quality Inventory[C]; Description: [B]; Weight: 3.6. Factor: Potential for pesticide and nitrogen leaching; Source: 1997 NRCS analysis[G]; Description: NRCS formula based on data about land vulnerability to manure nitrogen, commercial nitrogen, and pesticide leaching; Weight: 1.3. Factor: Potential for pesticide and nitrogen runoff; Source: 1997 NRCS analysis[G]; Description: NRCS formula based on data about land vulnerability to manure nitrogen, commercial nitrogen, and pesticide runoff; Weight: 1.7. Factor: Ratio of livestock animal units to cropland; Source: [A]; Description: [B]; Weight: 1.7. Factor: Number of concentrated animal feeding operations/animal feeding operations; Source: 2003 NRCS report based on 1997 Census of Agriculture data[H]; Description: Number of farms needing a comprehensive nutrient management plan; Weight: 2.8. Factor: Ratio of commercial fertilizers to cropland; Source: NRCS calculation based on 1995 data from the Association of American Plant Food Control Officials and 1997 NRI cropland data[C]; Description: [B]; Weight: 0.9. Factor: Wind erosion above T; Source: 1997 National Resources Inventory (Revised December 2000); Description: Cultivated and noncultivated cropland with a 4-year average rate of estimated soil loss due to wind erosion greater than T-- a tolerable rate of erosion above which soil productivity is believed to decrease; Weight: 4.2. Factor: Phosphorous runoff potential; Source: 1997 NRCS analysis[G]; Description: Same data used for factor measuring potential for pesticide and nitrogen runoff; Weight: 3.9. Factor: Riparian areas; Source: 1982 National Resources Inventory[C]; Description: [I]; Weight: 0.8. Factor: Carbon sequestration; Source: 1997 National Resources Inventory (Revised December 2000) and unknown data source; Description: Sum of data from other factors in the financial assistance formula-- nonirrigated cropland, federal grazing lands, nonfederal grazing lands and forestlands; Weight: 3.6. Factor: Coastal zone land; Source: NRCS calculation based on 1992 National Oceanic and Atmospheric Administration and unknown data[C]; Description: [J]; Weight: 3.6%. Sources: GAO analysis of NRCS and USDA data. Note: We used NRCS's own terminology for the factor names in this chart. In some instances, names do not precisely capture what is being measured. AWe were unable to verify the source of data for this factor. [B] Because we could not verify certain data sources, we were unable to provide an accurate description of what each factor measured. Blank cells indicate that we were unable to accurately describe what the factor measured. [C] Data source as reported by NRCS. We were unable to verify the source of data for this factor. [D] According to an NRI official, cropland eroding above T could have been estimated in one of two ways--(1) acres of cropland where the total wind, sheet and rill erosion rates exceeded T or (2) acres of cropland where either wind erosion, sheet and rill erosion, or both, exceeded T. We were not able to confirm how the data was estimated. [E] NRCS could not confirm the source or date of this data. The National Resources Inventory believed this data was from work NRI performed in 1987. [F] According to an NRI official, this factor measures acres of nonfederal, rural forestland with estimated average annual sheet and rill erosion above T. We were not able to obtain documentation to confirm this definition. [G] "Potential Priority Watersheds for Protection of Water Quality from Nonpoint Sources Related to Agriculture." Poster Presentation at the 52nd Annual SWCS Conference Toronto, Ontario, Canada, July 22-25, 1997 (Revised October 7, 1997). [H] Costs Associated with Development and Implementation of Comprehensive Nutrient Management Plans Part I--Nutrient Management, Land Treatment, Manure and Wastewater Handling and Storage, and Recordkeeping (NRCS, June 2003). [I] According to NRCS, the definition for riparian areas in the 1982 National Resources Inventory was acres of riparian areas--the banks, shorelines, or edges of the rising ground bordering a natural or manmade watercourse or water area (riparian areas are not limited to natural areas). [J] According to NRCS, this factor considers data on square miles of coastlines. [End of table] Table 6: Fiscal Year 2006 Formula for Allocating Ground and Surface Water Conservation Financial Assistance: Targeted area: High Plains Aquifer states--Colorado, Kansas, Nebraska, New Mexico, Oklahoma, South Dakota, Texas, and Wyoming; Allocation methodology: Percentage of state's acreage in the High Plains Aquifer; Weight: 40.6%. Targeted area: Western drought states--Arizona, California, Idaho, Montana, Nevada, North Dakota, Oregon, Utah, and Washington; Allocation methodology: Amount of irrigated acreage in each state; Weight: 41.5%. Targeted area: Additional states with agricultural water needs-- Alabama, Arkansas, Delaware, Florida, Georgia, Hawaii, Iowa, Louisiana, Maine, Minnesota, Mississippi, Missouri, North Carolina, Puerto Rico, Wisconsin; Allocation methodology: Proportional comparison of agriculture to nonagricultural use of water; Weight: 17.9%. Source: NRCS. [End of table] Table 7: Factors Used in the Fiscal Year 2006 Formula for Allocating EQIP Performance Bonuses: Factor: Ratio of technical assistance obligations to total obligations; Description: Ratio of obligated EQIP funds used for technical assistance in fiscal year 2005 to total obligated funds; Weight: 25%. Factor: Livestock-related contracts; Description: Ratio between the number of EQIP contracts issued for Comprehensive Nutrient Management Plans to the number of farms needing such plans[A]; Weight: 15. Factor: Cost-share obligations versus payments; Description: Ratio of cost-share dollars obligated to cost-share dollars paid in fiscal years 2004 and 2005; Weight: 15. Factor: Technical service provider obligations and disbursements; Description: Ratio of disbursements to obligations in fiscal years 2004 and 2005 to technical service providers--contractors that help producers install practices; Weight: 15. Factor: Weighted cost-share percentage; Description: Average cost- share rate by state, excluding limited resource farmer cost-share and incentive payments; Weight: 10. Factor: Limited resource farmer; Description: Percentage of total EQIP contracts entered into with limited resource farmers; Weight: 10. Factor: Program national priorities; Description: Ratio between acres treated with conservation practices that address the national priorities to the total agricultural base; Weight: 10%. Source: NRCS. [A] Comprehensive nutrient management plans are conservation plans unique to livestock operations. These plans document practices and strategies adopted by livestock operations to address natural resource concerns related to manure and organic by-products and their potential impacts on water quality. [End of table] Table 8: Fiscal Year 2006 Formula for Allocating Klamath Basin Program Financial Assistance: State: California; Weight: 50%. State: Oregon; Weight: 50%. Source: NRCS. [End of table] [End of section] Appendix III: Statistical Techniques to Determine Influential Factors in the 2006 EQIP Financial Allocation Formula: Using statistical techniques--that is, principal components regression and factor analysis--we analyzed the Environmental Quality Incentives Program (EQIP) formula used to allocate fiscal year 2006 financial assistance to the states to identify the environmental factors that most influenced the allocations. Sixty-five percent of the total EQIP funds for 2006 were based on the allocation formula for financial assistance. Principal Components Regression: In order to determine the relationships between the allocation and the environmental factors (variables), we typically would apply regression techniques to a model, expressed as: [See PDF for image/equation] [End of figure] In equation (1), the dependent variable is the funding allocation for state i, the x's are the j factors in the allocation formula, b0, b1,…,bj are the regression coefficients, and ei is the model error for the iTH state. When we used this model, however, standard regression techniques were not possible because many of the environmental factors used in the allocation formula were highly collinear.[Footnote 27] Collinearity occurs when variables are so highly correlated that it is difficult to distinguish their independent influences on the dependent variable--in this case, state allocation funding. In a regression analysis, highly correlated independent variables cause the following effects: (1) regression coefficients change, depending on which variables are included or excluded in the model, (2) standard errors are large, (3) regression coefficients are large with random signs, and (4) achieving statistical significance of the collinear parameters is difficult. Moreover, multicollinearity poses a problem if the purpose of the model is to estimate, or explain, rather than predict, the individual contributions of variables. Following Fekedulegn et al., (2002), Norton (1984), and others, we used principal components regression analysis since this technique is recommended when there is multicollinearity in the data.[Footnote 28] Before running the regression analysis, we performed the principal components analysis.[Footnote 29] This procedure generates a set of latent variables, called principal components--uncorrelated linear transformations of the original variables.[Footnote 30] At this stage, even though the new variables are not collinear, the same magnitude of variance is retained. Therefore, the elimination of small principal components reduces the total variance and substantially improves the diagnostic capability of the model. In order to eliminate these small principal components, various selection procedures are used. Following Fekedulegn (2002), we chose the cumulative eigenvalue product rule, which keeps the first principal components whose combined product is greater than 1.00 (Guiot et al., 1982).[Footnote 31] The principal components themselves are expressed as: (2) Z = X*V. In equation (2), Z is an (i x j) matrix of principal components, X is an (i x j) matrix of standardized environmental factors, and V is a (j x j) matrix of eigenvectors.[Footnote 32],[Footnote 33] After the principal components analysis and the elimination of smaller principal components as described above, we used the data in a cross- sectional multivariate regression expressed as: (3) [See PDF for image/equation] [End of figure] In equation (3), A is an (i x 1) vector for the allocation of funding for the states (the dependent variable in the regression), b01 is an (i x 1) vector of the intercept terms, Z is an (i x j) matrix of principal components, and a is a (j x 1) vector of new coefficients of the principal components. However, this procedure will usually leave some principal components that are not statistically significant. Therefore, to further eliminate the nonsignificant principal components, we used the SAS stepwise regression procedure.[Footnote 34] Specifically, we eliminated "r" principal components in the analysis, which consisted of the (1) number eliminated using the eigenvalue product rule and (2) number eliminated from the stepwise regression. We were then left with (j - r) principal components estimators or coefficients and the reduced form in equation 3 becomes: (4) [See PDF for image/equation] [End of figure] In equation (4), a is the vector of coefficients associated with the reduced set of (j-r) principal components and Z is an (i x (j-r)) matrix of principal components. With the r components eliminated, the principal components estimators--in terms of the standardized environmental factors of the allocation model--are obtained by multiplying the new vector of coefficients by the associated vectors in the matrix of eigenvectors: (5) [See PDF for image] [End of figure] In equation (5), bSpc (subscript pc stands for principal components) is the vector of j standardized principal component estimators of the regression coefficients of the environmental factors, V is the (j x (j - r)) matrix of eigenvectors, and a is the reduced vector of ((j - r) x 1) estimated coefficients as in equation 4. Once we have the standardized coefficients of the principal components estimators of the factors, we can transform them back into the coefficients of the original environmental factors. For the standardized estimators, the method for this transformation is expressed as: (6) [See PDF for image] [End of figure] In equation (6), Sxj is the standard deviation of the original jTH environmental factor, xj, bSj,pc is the jTH standardized estimator, and bj,pc is the coefficient of the original environmental factor. While we can obtain the regression coefficients of the original environmental factors (the bj,pc's) that have been corrected for multicollinearity, we cannot directly compare them because most have different units. For instance, some environmental and resource factors used in the formula are measured in acres, while others may be measured in terms of animal units. In other words, the largest coefficient may not be the most influential in the regression. Therefore, when comparing the relative importance of the factors (variables) in the regression, we mainly discuss the standardized estimators of the environmental factors used in the allocation formula.[Footnote 35] Data Used: For the 48 contiguous states, we used a cross-section of data for the dependent variable--the allocation variable--and the independent variables--the environmental variables (factors). We could not incorporate Alaska or Hawaii because we lacked complete data. We excluded two factors--independent variables--from the regression analysis because they were linear combinations of factors already included in the data. For instance, we could not include the carbon sequestration factor because it is the sum of four factors already included in the formula allocation model: acres of nonirrigated cropland, forestland, federal grazing land, and nonfederal grazing land. We also excluded the factor for pesticide and nitrogen runoff because it contains the same data as the phosphorous runoff potential factor. Although the U.S. Department of Agriculture (USDA) weights these factors differently, they are still linear combinations and, for regression analysis, must be excluded. In all, we ran the regression using the 2006 state allocations for the 48 states as our dependent variable and the 29 environmental and resource factors in the formula for our independent variables. Results: After reducing the components from the eigenvalues product rule and the stepwise regression, we were left with 13 principal components from the original 29. We then transformed the parameter estimates of the stepwise regression,, back into the coefficients of the standardized principal components of the environmental factors, the bSpc. The results for these standardized coefficients--bSpc, the t-values, and the probability values of t--sorted by the size of the standardized coefficient are shown in table 9. Specifically, a standardized coefficient of a factor measures the expected change in the dependent variable for a one unit change in the standardized independent variable, in this case the iTH factor, all other things being equal. Those variables that had the largest standardized coefficient as well as being highly statistically significant were acres of fair and poor rangeland, acres of nonfederal grazing land, acres of irrigated cropland, acres of American Indian tribal lands, wind erosion above T, and livestock animal units. As table 9 shows, as one would expect with a formula, most of the factors in the regression were highly significant and positively related to the allocation, except the four factors, acres of forestlands, potential for pesticide and nitrogen leaching, air quality nonattainment areas, and acres of federal grazing lands. Table 9: Standardized Principal Components Estimators of the Original Variables and Statistical Significance: Factor: Acres of fair and poor rangeland; Standardized coefficient: 1399095; t-value: 35.322; p-value: <0.0001. Factor: Acres of nonfederal grazing lands; Standardized coefficient: 1389052; t-value: 35.7784; p-value: <0.0001. Factor: Acres of irrigated cropland; Standardized coefficient: 1372591; t-value: 13.448; p-value: <0.0001. Factor: Acres of American Indian tribal lands; Standardized coefficient: 1313695; t-value: 13.2325; p-value: <0.0001. Factor: Wind erosion above T; Standardized coefficient: 1210688; t- value: 18.4507; p-value: <0.0001. Factor: Livestock animal units; Standardized coefficient: 1197842; t- value: 37.3831; p-value: <0.0001. Factor: Riparian areas; Standardized coefficient: 935709; t-value: 12.5955; p-value: <0.0001. Factor: Number of limited resource producers; Standardized coefficient: 776918; t-value: 17.9933; p-value: <0.0001. Factor: Acres of cropland eroding above T; Standardized coefficient: 748625; t-value: 11.1347; p-value: <0.0001. Factor: Acres of bodies of water; Standardized coefficient: 699697; t- value: 8.91583; p-value: <0.0001. Factor: Acres of cropland and pastureland soils affected by saline and/ or sodic conditions; Standardized coefficient: 654109; t-value: 6.14821; p-value: <0.0001. Factor: Acres of specialty cropland; Standardized coefficient: 648891; t-value: 10.1944; p-value: <0.0001. Factor: Acres of pastureland needing treatment; Standardized coefficient: 625264; t-value: 11.5436; p-value: <0.0001. Factor: Animal waste generation; Standardized coefficient: 537929; t- value: 6.19323; p-value: <0.0001. Factor: Acres of wetlands and at-risk species habitat; Standardized coefficient: 528679; t-value: 10.9819; p-value: <0.0001. Factor: Waste management capital cost; Standardized coefficient: 504716; t-value: 7.58475; p-value: <0.0001. Factor: Coastal zone land; Standardized coefficient: 501769; t-value: 9.1963; p-value: <0.0001. Factor: Acres of grazing land lost to conversion; Standardized coefficient: 449376; t-value: 6.32035; p-value: <0.0001. Factor: Miles of impaired rivers and streams; Standardized coefficient: 446096; t-value: 3.99622; p-value: 0.0008. Factor: Ratio of commercial fertilizers to cropland; Standardized coefficient: 409840; t-value: 4.10749; p-value: 0.0007. Factor: Acres of nonirrigated cropland; Standardized coefficient: 403724; t-value: 7.66134; p-value: <0.0001. Factor: Acres of forestlands eroding above T; Standardized coefficient: 393498; t-value: 5.97645; p-value: <0.0001. Factor: Phosphorous runoff potential; Standardized coefficient: 306870; t-value: 5.30147; p-value: <0.0001. Factor: Number of concentrated animal feeding operations/animal feeding operations; Standardized coefficient: 251359; t-value: 4.95367; p- value: 0.0001. Factor: Ratio of livestock animal units to cropland; Standardized coefficient: 213299; t-value: 2.08889; p-value: 0.0512. Factor: Acres of forestlands; Standardized coefficient: 89181; t-value: 1.19149; p-value: 0.2489. Factor: Potential for pesticide and nitrogen leaching; Standardized coefficient: 45721; t-value: 0.77; p-value: 0.4513. Factor: Air quality nonattainment areas; Standardized coefficient: - 33022; t-value: -0.64754; p-value: 0.5255. Factor: Acres of federal grazing lands; Standardized coefficient: - 280851; t-value: -2.53757; p-value: 0.0206. Source: GAO analysis of USDA data. Note: All variables above the bolded line are positive and statistically significant at the 0.05 percent level. Our analysis does not include an adjustment made to the variable "acres of American Indian tribal lands" affecting two states. We do not expect that this adjustment would have a material affect on the results. [End of table] Factor Analysis of EQIP Environmental Variables: We used the factor analysis technique to reduce the original set of variables (environmental factors) in the EQIP formula to a smaller set of underlying factors that actually drive the variables and the relationships among these variables.[Footnote 36] Factor analysis has been used previously by researchers to identify, group, and interpret various environmental concerns, such as soil quality, that cannot be measured directly, but must be inferred by measuring other attributes that serve as indicators.[Footnote 37] For this formula, the underlying factors should mimic, in some sense, the underlying environmental concerns, such as water quality and quantity, soil productivity, and wildlife habitat preservation. Explanation of the Technique: Factor analysis is a technique used to explain the correlations between variables and to derive a new set of underlying variables, called "factors," that give a better understanding of the data being analyzed. Using this technique allows us to determine what smaller number of factors accounts for the correlation in the larger set of variables in the formula. In factor analysis, each observed variable, x, can be expressed as a weighted composite of a set of underlying, latent variables (f's) such that: (7) [See PDF for image] [End of figure] In equation (7), the correlation between the observed variables, the x's, can be explained in terms of the underlying (latent) factors. These latent factors explain the common variance between the variables. For example, given a set of observed variables, factor analysis forms a set of factors that are as independent from each other as possible, while the observed variables within each factor are as highly correlated as possible. To perform the factor analysis, we used the SAS PROC FACTOR procedure, choosing the principal factors method to extract the factors. One part of the analysis was to determine the number of factors to extract. Hypothetically, there can be one factor for every variable, but the goal is to reduce this number to a subset of factors that drive, or control, the values of the variables being measured. We postulated that the underlying factors should mimic, in some sense, the underlying environmental concerns, such as water quality and quantity, soil productivity, and wildlife habitat. However, since the data contain certain variables such as acres of nonirrigated cropland, acres of nonfederal grazing land, or acres of American Indian tribal lands, the latent factors may be different in character. To determine the number of factors, there are several computational methods and more subjective methods such as ease of interpretability of factors. We used both the ease of interpretability of the factors, as well as the "scree test."[Footnote 38] As is typically done to achieve a more meaningful and interpretable solution, we applied a rotation technique to the initial factor pattern matrix.[Footnote 39] Results: We used the rotated factor pattern matrix to interpret the meaning of the latent factors, which we identified through their correlations with the environmental factors (variables), as shown in table 10. The factor loadings that have an absolute value equal to or greater than 0.4 are shaded, and several variables are significantly correlated with more than one factor--called a "split loading."[Footnote 40] Table 10: Rotated Factor Pattern Matrix: Factor or variable from formula: Acres of nonfederal grazing land; Latent factor: 1: 0.95432; Latent factor: 2: -0.14193; Latent factor: 3: 0.00329; Latent factor: 4: 0.10117. Factor or variable from formula: Acres of fair and poor rangeland; Latent factor: 1: 0.89044; Latent factor: 2: -0.18858; Latent factor: 3: 0.04876; Latent factor: 4: -0.03961. Factor or variable from formula: Livestock animal units; Latent factor: 1: 0.77845; Latent factor: 2: 0.51746; Latent factor: 3: 0.07331; Latent factor: 4: 0.19868. Factor or variable from formula: Wind erosion above T; Latent factor: 1: 0.76534; Latent factor: 2: 0.12833; Latent factor: 3: 0.11974; Latent factor: 4: -0.29702. Factor or variable from formula: Acres of cropland eroding above T; Latent factor: 1: 0.69604; Latent factor: 2: 0.613; Latent factor: 3: - 0.01102; Latent factor: 4: -0.21171. Factor or variable from formula: Riparian areas; Latent factor: 1: 0.68226; Latent factor: 2: 0.16742; Latent factor: 3: 0.37957; Latent factor: 4: 0.23914. Factor or variable from formula: Acres of grazing land lost to conversion; Latent factor: 1: 0.64431; Latent factor: 2: 0.26539; Latent factor: 3: -0.0365; Latent factor: 4: 0.11935. Factor or variable from formula: Acres of irrigated cropland; Latent factor: 1: 0.61829; Latent factor: 2: 0.0418; Latent factor: 3: 0.14401; Latent factor: 4: 0.4548. Factor or variable from formula: Acres of pastureland needing treatment; Latent factor: 1: 0.60112; Latent factor: 2: 0.28467; Latent factor: 3: 0.24348; Latent factor: 4: 0.11009. Factor or variable from formula: Number of limited resource producers; Latent factor: 1: 0.59529; Latent factor: 2: 0.56896; Latent factor: 3: 0.23444; Latent factor: 4: 0.20013. Factor or variable from formula: Acres of federal grazing land; Latent factor: 1: 0.46349; Latent factor: 2: -0.4339; Latent factor: 3: - 0.32474; Latent factor: 4: 0.01709. Factor or variable from formula: Acres of cropland and pastureland soils affected by saline and/or sodic conditions; Latent factor: 1: 0.39952; Latent factor: 2: -0.17105; Latent factor: 3: -0.18815; Latent factor: 4: 0.39389. Factor or variable from formula: Number of concentrated animal feeding operations/animal feeding operations; Latent factor: 1: 0.05818; Latent factor: 2: 0.87513; Latent factor: 3: -0.03339; Latent factor: 4: - 0.0465. Factor or variable from formula: Phosphorous runoff potential; Latent factor: 1: 0.12202; Latent factor: 2: 0.86976; Latent factor: 3: 0.28758; Latent factor: 4: 0.13109. Factor or variable from formula: Waste management capital cost; Latent factor: 1: 0.1018; Latent factor: 2: 0.76694; Latent factor: 3: 0.04769; Latent factor: 4: 0.07004. Factor or variable from formula: Acres of nonirrigated cropland; Latent factor: 1: 0.46277; Latent factor: 2: 0.71639; Latent factor: 3: - 0.15479; Latent factor: 4: -0.23632. Factor or variable from formula: Potential for pesticide and nitrogen leaching; Latent factor: 1: 0.01166; Latent factor: 2: 0.69366; Latent factor: 3: 0.46219; Latent factor: 4: 0.29581. Factor or variable from formula: Animal waste generation; Latent factor: 1: 0.2898; Latent factor: 2: 0.57515; Latent factor: 3: 0.26865; Latent factor: 4: 0.19698. Factor or variable from formula: Acres of American Indian tribal lands; Latent factor: 1: 0.24861; Latent factor: 2: -0.37768; Latent factor: 3: -0.26536; Latent factor: 4: 0.01991. Factor or variable from formula: Ratio of livestock animal units to cropland; Latent factor: 1: 0.08217; Latent factor: 2: -0.47811; Latent factor: 3: -0.05783; Latent factor: 4: 0.29948. Factor or variable from formula: Acres of wetlands and at-risk species habitat; Latent factor: 1: 0.14074; Latent factor: 2: 0.18228; Latent factor: 3: 0.86993; Latent factor: 4: -0.1914. Factor or variable from formula: Acres of bodies of water; Latent factor: 1: 0.35908; Latent factor: 2: 0.10564; Latent factor: 3: 0.81371; Latent factor: 4: -0.01889. Factor or variable from formula: Coastal zone land; Latent factor: 1: 0.1042; Latent factor: 2: -0.05594; Latent factor: 3: 0.79583; Latent factor: 4: 0.29895. Factor or variable from formula: Acres of forestlands; Latent factor: 1: 0.13012; Latent factor: 2: 0.24312; Latent factor: 3: 0.69724; Latent factor: 4: 0.20541. Factor or variable from formula: Acres of specialty cropland; Latent factor: 1: 0.09679; Latent factor: 2: -0.10928; Latent factor: 3: 0.30919; Latent factor: 4: 0.78195. Factor or variable from formula: Acres of forestlands eroding above T; Latent factor: 1: 0.15413; Latent factor: 2: -0.00078; Latent factor: 3: -0.04538; Latent factor: 4: 0.77575. Factor or variable from formula: Miles of impaired rivers and streams; Latent factor: 1: 0.20763; Latent factor: 2: 0.12325; Latent factor: 3: 0.1149; Latent factor: 4: 0.60384. Factor or variable from formula: Ratio of commercial fertilizer to cropland; Latent factor: 1: -0.15704; Latent factor: 2: 0.21558; Latent factor: 3: 0.05047; Latent factor: 4: 0.52823. Factor or variable from formula: Air quality nonattainment areas; Latent factor: 1: -0.19264; Latent factor: 2: -0.2472; Latent factor: 3: -0.00932; Latent factor: 4: 0.32038. Source: GAO analysis of USDA data. Note: Variable loadings with a significant correlation are shaded. [End of table] The factor analysis technique also calculates the amount of common variance explained by each latent factor. For these data, the variances are: factor 1--6.44, factor 2--5.49, factor 3--3.56, and factor 4-- 3.00, accounting for about 71 percent of the common variance in the data. Overall, the four factors (1) all relate to environmental concerns, as well as agricultural resources, and (2) each latent factor contributes a decreasing amount of common variance to the total variation among all of the variables. We interpreted the EQIP data that went into the factor analysis to represent (1) dryland agriculture and cattle feeding, (2) water quality concerns relating to concentrated livestock feeding operations and nonirrigated cropland, (3) wildlife habitat preservation, and (4) specialty crops/intensive agriculture and water quality/quantity concerns. Specifics of the factor analysis follow: Factor 1: This factor contributes the most variation to the factor analysis and seems to be associated with dryland agriculture and cattle grazing and feeding. The variables--acres of nonfederal grazing lands, acres of fair and poor rangeland, wind erosion above T, acres of cropland eroding above T, and acres of irrigated cropland--are all descriptors of this type of agriculture. In addition, factor 1 is also strongly correlated with the livestock animal units variable, although it has a split loading with factor 2. While the number of limited resource producers variable has a split loading between this factor and factor 2, it is most heavily loaded with this factor. Factor 2: This factor, like factor 1, has to do with livestock operations, as well as with other important livestock-related variables that affect water quality. Here, the highest loading is with the variable, number of concentrated animal feeding operations/animal feeding operations, (CAFOs) (0.88), although it has the split loading with livestock animal units (0.52). In addition, factor 2 showed high loadings for phosphorous runoff potential and potential for pesticide and nitrogen leaching, which may be related to sediment losses from both animal and cropland agriculture. Moreover, as cropland and CAFOs are usually in the same location, one would expect the variable for acres of nonirrigated cropland to also have a high loading, which it does (0.72). Factor 3: This factor seems to be related to environmental concerns about wildlife habitat, with the highest loading going to acres of wetland and at-risk species habitat (0.87), as well as to acres of bodies of water, (0.81) coastal zone land (0.80) and acres of forestlands (0.70). Potential for pesticide and nitrogen leaching (0.46) showed a split loading with factor 2. Factor 4: This factor seems to represent variables relating to specialty crop and intensive agriculture, with high loadings for acres of specialty crops, ratio of commercial fertilizer to cropland, and acres of irrigated cropland, (which had a split loading with factor 1). Also, acres of cropland and pastureland affected by saline and/or sodic conditions, a soil condition that often accompanies irrigated soils, is almost significantly correlated to Factor 4 (0.39). This factor also highly loads with miles of impaired rivers and streams, which may be an indication of water quality and quantity concerns associated with soils that require irrigation. Factor 4 is also highly associated with acres of forestlands eroding above T, many of which are found in the same areas that contain acres of irrigated cropland. The two variables--air quality nonattainment areas and acres of American Indian tribal lands--did not load onto any of the latent factors. When this happens, the variable has a unique variance that is not explained by the common factors. [End of section] Appendix IV Initial EQIP Funding Provided to the States, Fiscal Year 2006: State: Alabama; General financial assistance: $11,692,291; General technical assistance: $3,409,837; Colorado Salinity[A]: $0; Performance bonuses[A]: $1,499,189; Regional equity[A]: $0; Ground and Surface Water[A]: $169,802; Klamath Basin[A]: $0; Total EQIP funding[B]: $16,771,119. State: Alaska; General financial assistance: 2,065,044; General technical assistance: 855,803; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,729,833; Regional equity[A]: 2,189,241; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 6,839,921. State: Arizona; General financial assistance: 19,838,811; General technical assistance: 4,909,614; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,383,866; Regional equity[A]: 0; Ground and Surface Water[A]: 2,195,991; Klamath Basin[A]: 0; Total EQIP funding[B]: 28,328,282. State: Arkansas; General financial assistance: 15,285,890; General technical assistance: 4,275,715; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,845,155; Regional equity[A]: 0; Ground and Surface Water[A]: 3,197,575; Klamath Basin[A]: 0; Total EQIP funding[B]: 24,604,335. State: California; General financial assistance: 35,601,305; General technical assistance: 9,917,421; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 12,139,356; Klamath Basin[A]: 5,244,128; Total EQIP funding[B]: 62,902,210. State: Colorado; General financial assistance: 19,166,118; General technical assistance: 6,402,301; Colorado Salinity[A]: 9,746,600; Performance bonuses[A]: 1,153,222; Regional equity[A]: 0; Ground and Surface Water[A]: 4,731,333; Klamath Basin[A]: 0; Total EQIP funding[B]: 41,199,573. State: Connecticut; General financial assistance: 2,276,617; General technical assistance: 1,298,554; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 2,409,129; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 5,984,300. State: Delaware; General financial assistance: 4,262,315; General technical assistance: 1,120,129; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,499,189; Regional equity[A]: 559,577; Ground and Surface Water[A]: 177,342; Klamath Basin[A]: 0; Total EQIP funding[B]: 7,618,551. State: Florida; General financial assistance: 18,598,404; General technical assistance: 5,661,746; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 904,160; Klamath Basin[A]: 0; Total EQIP funding[B]: 25,164,310. State: Georgia; General financial assistance: 13,596,275; General technical assistance: 3,956,923; Colorado Salinity[A]: 0; Performance bonuses[A]: 922,578; Regional equity[A]: 0; Ground and Surface Water[A]: 574,887; Klamath Basin[A]: 0; Total EQIP funding[B]: 19,050,663. State: Hawaii; General financial assistance: 2,830,085; General technical assistance: 1,315,702; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 1,826,989; Ground and Surface Water[A]: 1,537,667; Klamath Basin[A]: 0; Total EQIP funding[B]: 7,510,443. State: Idaho; General financial assistance: 10,402,360; General technical assistance: 3,120,403; Colorado Salinity[A]: 0; Performance bonuses[A]: 2,075,800; Regional equity[A]: 0; Ground and Surface Water[A]: 4,764,140; Klamath Basin[A]: 0; Total EQIP funding[B]: 20,362,703. State: Illinois; General financial assistance: 13,490,217; General technical assistance: 3,506,538; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 16,996,755. State: Indiana; General financial assistance: 10,199,898; General technical assistance: 2,756,379; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 12,956,277. State: Iowa; General financial assistance: 19,857,205; General technical assistance: 5,539,542; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 212,556; Klamath Basin[A]: 0; Total EQIP funding[B]: 25,609,303. State: Kansas; General financial assistance: 20,568,274; General technical assistance: 5,916,955; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 4,277,167; Klamath Basin[A]: 0; Total EQIP funding[B]: 30,762,396. State: Kentucky; General financial assistance: 10,470,827; General technical assistance: 3,014,900; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 13,485,727. State: Louisiana; General financial assistance: 12,681,547; General technical assistance: 3,641,657; Colorado Salinity[A]: 0; Performance bonuses[A]: 2,075,800; Regional equity[A]: 0; Ground and Surface Water[A]: 493,370; Klamath Basin[A]: 0; Total EQIP funding[B]: 18,892,373. State: Maine; General financial assistance: 4,969,838; General technical assistance: 1,612,816; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,499,189; Regional equity[A]: 492,709; Ground and Surface Water[A]: 387,111; Klamath Basin[A]: 0; Total EQIP funding[B]: 8,961,663. State: Maryland; General financial assistance: 6,057,344; General technical assistance: 1,919,649; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 7,976,993. State: Massachusetts; General financial assistance: 2,252,718; General technical assistance: 1,061,011; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 2,057,775; Ground and Surface Water[A]: 9,740; Klamath Basin[A]: 0; Total EQIP funding[B]: 5,381,243. State: Michigan; General financial assistance: 15,171,136; General technical assistance: 4,586,470; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 19,757,606. State: Minnesota; General financial assistance: 25,108,644; General technical assistance: 6,645,257; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 246,344; Klamath Basin[A]: 0; Total EQIP funding[B]: 32,000,245. State: Mississippi; General financial assistance: 12,880,865; General technical assistance: 3,440,744; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,499,189; Regional equity[A]: 0; Ground and Surface Water[A]: 2,953,823; Klamath Basin[A]: 0; Total EQIP funding[B]: 20,774,620[C]. State: Missouri; General financial assistance: 18,150,708; General technical assistance: 4,835,351; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 403,185; Klamath Basin[A]: 0; Total EQIP funding[B]: 23,389,244. State: Montana; General financial assistance: 22,189,687; General technical assistance: 5,834,973; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,153,222; Regional equity[A]: 0; Ground and Surface Water[A]: 2,491,718; Klamath Basin[A]: 0; Total EQIP funding[B]: 31,669,601. State: Nebraska; General financial assistance: 20,543,213; General technical assistance: 5,607,316; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 5,634,218; Klamath Basin[A]: 0; Total EQIP funding[B]: 31,784,747. State: Nevada; General financial assistance: 4,568,635; General technical assistance: 1,578,562; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 1,266,836; Ground and Surface Water[A]: 842,096; Klamath Basin[A]: 0; Total EQIP funding[B]: 8,256,129. State: New Hampshire; General financial assistance: 1,665,326; General technical assistance: 771,967; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 3,022,681; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 5,459,975. State: New Jersey; General financial assistance: 2,831,241; General technical assistance: 1,055,596; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 1,627,774; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 5,514,610. State: New Mexico; General financial assistance: 16,436,791; General technical assistance: 5,168,241; Colorado Salinity[A]: 0; Performance bonuses[A]: 2,306,444; Regional equity[A]: 0; Ground and Surface Water[A]: 1,332,763; Klamath Basin[A]: 0; Total EQIP funding[B]: 25,244,238. State: New York; General financial assistance: 11,000,760; General technical assistance: 3,416,030; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 14,416,790. State: North Carolina; General financial assistance: 14,156,869; General technical assistance: 3,741,418; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 300,995; Klamath Basin[A]: 0; Total EQIP funding[B]: 18,199,282. State: North Dakota; General financial assistance: 16,419,674; General technical assistance: 4,644,465; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,960,477; Regional equity[A]: 0; Ground and Surface Water[A]: 117,791; Klamath Basin[A]: 0; Total EQIP funding[B]: 23,142,407. State: Ohio; General financial assistance: 11,752,789; General technical assistance: 3,834,502; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,268,544; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 16,855,835. State: Oklahoma; General financial assistance: 20,967,673; General technical assistance: 5,195,174; Colorado Salinity[A]: 0; Performance bonuses[A]: 2,075,800; Regional equity[A]: 0; Ground and Surface Water[A]: 966,706; Klamath Basin[A]: 0; Total EQIP funding[B]: 29,205,352. State: Oregon; General financial assistance: 11,345,753; General technical assistance: 3,096,493; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,614,511; Regional equity[A]: 0; Ground and Surface Water[A]: 2,251,318; Klamath Basin[A]: 5,593,064; Total EQIP funding[B]: 23,901,139. State: Pennsylvania; General financial assistance: 10,470,862; General technical assistance: 3,364,889; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 13,835,751. State: Rhode Island; General financial assistance: 940,474; General technical assistance: 337,025; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 3,600,911; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 4,878,410. State: South Carolina; General financial assistance: 5,845,873; General technical assistance: 2,103,593; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,845,155; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 9,794,621. State: South Dakota; General financial assistance: 15,806,924; General technical assistance: 4,488,602; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,153,222; Regional equity[A]: 0; Ground and Surface Water[A]: 555,182; Klamath Basin[A]: 0; Total EQIP funding[B]: 22,003,929. State: Tennessee; General financial assistance: 10,020,289; General technical assistance: 2,821,655; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 12,841,944. State: Texas; General financial assistance: 65,270,552; General technical assistance: 17,442,105; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,383,866; Regional equity[A]: 0; Ground and Surface Water[A]: 7,193,968; Klamath Basin[A]: 0; Total EQIP funding[B]: 91,290,491. State: Utah; General financial assistance: 8,918,556; General technical assistance: 3,728,733; Colorado Salinity[A]: 9,746,600; Performance bonuses[A]: 2,075,800; Regional equity[A]: 0; Ground and Surface Water[A]: 1,289,849; Klamath Basin[A]: 0; Total EQIP funding[B]: 25,759,537. State: Vermont; General financial assistance: 2,323,794; General technical assistance: 1,157,690; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 2,370,729; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 5,852,213. State: Virginia; General financial assistance: 10,803,694; General technical assistance: 2,909,515; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,268,544; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 14,981,753. State: Washington; General financial assistance: 13,651,196; General technical assistance: 3,463,804; Colorado Salinity[A]: 0; Performance bonuses[A]: 1,037,900; Regional equity[A]: 0; Ground and Surface Water[A]: 2,087,065; Klamath Basin[A]: 0; Total EQIP funding[B]: 20,239,965. State: West Virginia; General financial assistance: 4,328,232; General technical assistance: 1,594,233; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 1,525,651; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 7,448,115. State: Wisconsin; General financial assistance: 16,218,507; General technical assistance: 4,262,300; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 174,865; Klamath Basin[A]: 0; Total EQIP funding[B]: 20,655,672. State: Wyoming; General financial assistance: 10,914,358; General technical assistance: 2,962,722; Colorado Salinity[A]: 44,000; Performance bonuses[A]: 2,191,122; Regional equity[A]: 0; Ground and Surface Water[A]: 2,242,966; Klamath Basin[A]: 0; Total EQIP funding[B]: 18,355,168. State: Pacific Basin; General financial assistance: 1,370,851; General technical assistance: 239,153; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 0; Ground and Surface Water[A]: 0; Klamath Basin[A]: 0; Total EQIP funding[B]: 1,610,004. State: Puerto Rico[D]; General financial assistance: 4,364,658; General technical assistance: 1,391,991; Colorado Salinity[A]: 0; Performance bonuses[A]: 0; Regional equity[A]: 1,050,000; Ground and Surface Water[A]: 180,892; Klamath Basin[A]: 0; Total EQIP funding[B]: 6,987,541. State: Total[E]; General financial assistance: $662,601,964; General technical assistance: $190,934,165; Colorado Salinity[A]: $19,537,200; Performance bonuses[A]: $38,517,615; Regional equity[A]: $24,000,000; Ground and Surface Water[A]: $67,037,941; Klamath Basin[A]: $10,837,192; Total EQIP funding[B]: $1,013,466,074. Source: GAO analysis of NRCS data. Note: Dollars allocated at the national level to producers through Conservation Innovation Grants are not included. ANRCS provides these funds to the states through both financial and technical assistance, the majority of which are financial assistance. [B] The source for data on total EQIP funding, except for Mississippi, is NRCS at [Hyperlink, http://www.nrcs.usda.gov/PROGRAMS/2006_allocations/2006Allocationstostat esbyprog/FY2006program_allocations_by_states.html] [Hyperlink, http://www.nrcs.usda.gov/PROGRAMS/2006_allocations/2006Allocationstostat esbyprog/FY2006program_allocations_by_states.html] [Hyperlink, http://www.nrcs.usda.gov/PROGRAMS/2006_allocations/2006Allocationstostat esbyprog/FY2006program_allocations_by_states.html]. Due to rounding, totals may not equal the sum of funding from all categories. [C] Mississippi's funding total is approximately $189,000 more than what was reported by NRCS. The $189,000 represents a payment transfer made from the Mississippi state office to headquarters for training. In order to consistently represent the initial amount of funding each NRCS state office received from headquarters, we included this $189,000 in Mississippi's funding total. [D] Totals for Puerto Rico also include funding provided to the U.S. Virgin Islands. [E] Total funding may not equal the sum of state funding due to rounding. [End of table] [End of section] Appendix V: Historical EQIP Funding Levels, Fiscal Years 2001-2006: State: Alabama; 2001: $3,682,300; 2002: $7,113,500; 2003: $10,682,200; 2004: $13,637,700; 2005: $16,285,108; 2006[A]: $16,771,119. State: Alaska; 2001: 498,700; 2002: 996,200; 2003: 1,330,900; 2004: 9,087,600; 2005: 7,345,521; 2006[A]: 6,839,921. State: Arizona; 2001: 7,107,300; 2002: 12,314,800; 2003: 13,579,100; 2004: 20,017,300; 2005: 22,584,523; 2006[A]: 28,328,282. State: Arkansas; 2001: 4,557,300; 2002: 8,353,300; 2003: 12,880,500; 2004: 20,835,800; 2005: 23,652,812; 2006[A]: 24,604,335. State: California; 2001: 9,184,200; 2002: 19,137,900; 2003: 48,581,600; 2004: 56,981,700; 2005: 62,114,391; 2006[A]: 62,902,210. State: Colorado; 2001: 7,074,000; 2002: 14,432,500; 2003: 25,560,300; 2004: 36,931,700; 2005: 39,185,835; 2006[A]: 41,199,573. State: Connecticut; 2001: 790,300; 2002: 1,541,700; 2003: 2,379,700; 2004: 8,021,300; 2005: 6,171,688; 2006[A]: 5,984,300. State: Delaware; 2001: 968,500; 2002: 1,939,200; 2003: 3,032,600; 2004: 5,366,500; 2005: 6,532,427; 2006[A]: 7,618,551. State: Florida; 2001: 5,365,800; 2002: 10,178,300; 2003: 15,554,300; 2004: 22,392,900; 2005: 24,123,030; 2006[A]: 25,164,310. State: Georgia; 2001: 4,107,200; 2002: 8,010,200; 2003: 12,167,200; 2004: 16,188,600; 2005: 18,674,184; 2006[A]: 19,050,663. State: Hawaii; 2001: 648,900; 2002: 1,384,200; 2003: 1,969,800; 2004: 8,060,300; 2005: 8,192,003; 2006[A]: 7,510,443. State: Idaho; 2001: 3,328,800; 2002: 6,416,800; 2003: 17,727,900; 2004: 18,994,300; 2005: 19,174,741; 2006[A]: 20,362,703. State: Illinois; 2001: 4,156,300; 2002: 7,798,000; 2003: 12,108,000; 2004: 16,729,200; 2005: 17,969,667; 2006[A]: 16,996,755. State: Indiana; 2001: 2,757,600; 2002: 5,140,200; 2003: 8,111,900; 2004: 11,599,400; 2005: 12,574,260; 2006[A]: 12,956,277. State: Iowa; 2001: 7,036,400; 2002: 8,994,800; 2003: 14,231,400; 2004: 23,399,700; 2005: 25,856,704; 2006[A]: 25,609,303. State: Kansas; 2001: 5,014,700; 2002: 10,448,800; 2003: 19,763,400; 2004: 28,144,400; 2005: 30,447,213; 2006[A]: 30,762,396. State: Kentucky; 2001: 3,111,400; 2002: 5,913,300; 2003: 8,958,100; 2004: 12,039,300; 2005: 13,288,086; 2006[A]: 13,485,727. State: Louisiana; 2001: 3,947,800; 2002: 7,089,900; 2003: 10,913,400; 2004: 15,156,500; 2005: 18,048,303; 2006[A]: 18,892,373. State: Maine; 2001: 1,982,000; 2002: 3,070,500; 2003: 4,380,300; 2004: 9,155,900; 2005: 9,806,574; 2006[A]: 8,961,663. State: Maryland; 2001: 2,067,600; 2002: 3,396,800; 2003: 5,125,400; 2004: 6,701,100; 2005: 7,732,193; 2006[A]: 7,976,993. State: Massachusetts; 2001: 933,600; 2002: 1,715,200; 2003: 2,632,600; 2004: 6,453,000; 2005: 4,952,573; 2006[A]: 5,381,243. State: Michigan; 2001: 4,334,400; 2002: 8,225,400; 2003: 12,713,300; 2004: 17,463,300; 2005: 18,629,584; 2006[A]: 19,757,606. State: Minnesota; 2001: 5,788,200; 2002: 11,483,700; 2003: 19,012,100; 2004: 29,423,700; 2005: 32,924,161; 2006[A]: 32,000,245. State: Mississippi; 2001: 5,218,700; 2002: 8,298,100; 2003: 11,860,200; 2004: 19,492,400; 2005: 21,420,866; 2006[A]: 20,774,620[B]. State: Missouri; 2001: 5,042,500; 2002: 9,944,300; 2003: 15,271,600; 2004: 22,394,800; 2005: 23,379,201; 2006[A]: 23,389,244. State: Montana; 2001: 6,463,100; 2002: 13,295,500; 2003: 19,354,600; 2004: 28,432,400; 2005: 31,810,709; 2006[A]: 31,669,601. State: Nebraska; 2001: 4,805,400; 2002: 10,673,400; 2003: 20,441,800; 2004: 29,600,300; 2005: 32,123,093; 2006[A]: 31,784,747. State: Nevada; 2001: 1,432,700; 2002: 2,773,700; 2003: 4,467,000; 2004: 9,452,900; 2005: 8,914,534; 2006[A]: 8,256,129. State: New Hampshire; 2001: 614,800; 2002: 1,265,400; 2003: 1,779,700; 2004: 2,297,000; 2005: 5,726,909; 2006[A]: 5,459,975. State: New Jersey; 2001: 965,100; 2002: 1,891,900; 2003: 2,919,200; 2004: 5,784,000; 2005: 4,386,375; 2006[A]: 5,514,610. State: New Mexico; 2001: 5,796,800; 2002: 12,460,100; 2003: 16,143,600; 2004: 27,889,800; 2005: 29,802,972; 2006[A]: 25,244,238. State: New York; 2001: 3,822,800; 2002: 6,774,000; 2003: 10,355,500; 2004: 12,484,700; 2005: 13,128,566; 2006[A]: 14,416,790. State: North Carolina; 2001: 4,572,300; 2002: 8,590,100; 2003: 13,169,500; 2004: 16,473,100; 2005: 17,985,395; 2006[A]: 18,199,282. State: North Dakota; 2001: 4,263,300; 2002: 8,710,200; 2003: 14,394,600; 2004: 19,181,100; 2005: 22,014,952; 2006[A]: 23,142,407. State: Ohio; 2001: 3,250,900; 2002: 6,505,300; 2003: 10,150,400; 2004: 13,412,400; 2005: 15,823,019; 2006[A]: 16,855,835. State: Oklahoma; 2001: 5,018,900; 2002: 9,290,600; 2003: 13,913,400; 2004: 25,378,800; 2005: 29,017,864; 2006[A]: 29,205,352. State: Oregon; 2001: 4,383,600; 2002: 7,404,400; 2003: 17,950,700; 2004: 21,615,200; 2005: 21,839,220; 2006[A]: 23,901,139. State: Pennsylvania; 2001: 3,364,400; 2002: 5,960,600; 2003: 9,056,800; 2004: 11,853,900; 2005: 12,828,822; 2006[A]: 13,835,751. State: Rhode Island; 2001: 422,900; 2002: 841,400; 2003: 1,309,100; 2004: 1,026,800; 2005: 5,461,693; 2006[A]: 4,878,410. State: South Carolina; 2001: 2,281,700; 2002: 4,453,700; 2003: 6,812,400; 2004: 9,025,800; 2005: 9,663,381; 2006[A]: 9,794,621. State: South Dakota; 2001: 4,695,000; 2002: 10,424,500; 2003: 13,595,200; 2004: 19,076,300; 2005: 20,547,674; 2006[A]: 22,003,929. State: Tennessee; 2001: 3,114,500; 2002: 5,913,100; 2003: 8,935,400; 2004: 11,513,300; 2005: 12,759,284; 2006[A]: 12,841,944. State: Texas; 2001: 15,187,200; 2002: 28,700,500; 2003: 57,717,300; 2004: 78,565,800; 2005: 90,007,418; 2006[A]: 91,290,491. State: Utah; 2001: 4,655,000; 2002: 10,139,900; 2003: 14,565,800; 2004: 20,976,900; 2005: 23,107,745; 2006[A]: 25,759,537. State: Vermont; 2001: 1,281,800; 2002: 1,907,700; 2003: 2,687,100; 2004: 7,341,400; 2005: 5,739,903; 2006[A]: 5,852,213. State: Virginia; 2001: 3,172,500; 2002: 6,216,300; 2003: 9,494,700; 2004: 12,366,100; 2005: 13,336,380; 2006[A]: 14,981,753. State: Washington; 2001: 4,194,000; 2002: 7,420,300; 2003: 12,937,800; 2004: 18,549,900; 2005: 20,694,391; 2006[A]: 20,239,965. State: West Virginia; 2001: 1,807,400; 2002: 3,507,700; 2003: 5,313,600; 2004: 8,690,200; 2005: 7,404,453; 2006[A]: 7,448,115. State: Wisconsin; 2001: 4,554,800; 2002: 8,730,200; 2003: 13,486,800; 2004: 18,960,500; 2005: 20,962,647; 2006[A]: 20,655,672. State: Wyoming; 2001: 3,684,700; 2002: 7,217,800; 2003: 11,335,200; 2004: 16,135,900; 2005: 17,803,201; 2006[A]: 18,355,168. State: Pacific Basin; 2001: 346,300; 2002: 582,100; 2003: 958,200; 2004: 866,800; 2005: 1,771,577; 2006[A]: 1,610,004. State: Puerto Rico[C]; 2001: 964,700; 2002: 1,808,800; 2003: 2,928,100; 2004: 6,660,200; 2005: 6,150,928; 2006[A]: 6,987,541. State: Total; 2001: $197,821,100; 2002: $376,796,800; 2003: $626,701,300; 2004: $908,279,900; 2005: $991,878,752; 2006[A]: $1,013,466,074. Source: GAO analysis of NRCS data. [A] The data source for fiscal year 2006 total EQIP funding, except for Mississippi, was NRCS's Web site: [Hyperlink, http://www.nrcs.usda.gov/PROGRAMS/2006_allocations/2006Allocationstostat esbyprog/FY2006program_allocations_by_states.html] [B] Mississippi's funding total for 2006 is approximately $189,000 more than what was reported by NRCS. The $189,000 represents a payment transfer made from the Mississippi state office to headquarters for training. [C] Totals for Puerto Rico also include funding provided to the U.S. Virgin Islands. [End of table] [End of section] Appendix VI: Fiscal Year 2005 EQIP Obligations by Conservation Practice: Practice name/payment type: Waste storage facility; Number[A]: 2,983; EQIP dollars obligated: $91,086,442; Ground and Surface Water Conservation dollars obligated: $13,500; Klamath dollars obligated: $0; Total dollars obligated: $91,099,942; Percentage of total: 11.43%. Practice name/payment type: Fence; Number[A]: 19,303; EQIP dollars obligated: 59,497,144; Ground and Surface Water Conservation dollars obligated: 80,456; Klamath dollars obligated: 72,012; Total dollars obligated: 59,649,612; Percentage of total: 7.48. Practice name/payment type: Irrigation system, sprinkler; Number[A]: 3,633; EQIP dollars obligated: 40,316,414; Ground and Surface Water Conservation dollars obligated: 14,649,127; Klamath dollars obligated: 3,184,141; Total dollars obligated: 58,149,682; Percentage of total: 7.29. Practice name/payment type: Brush management; Number[A]: 9,664; EQIP dollars obligated: 38,418,198; Ground and Surface Water Conservation dollars obligated: 8,160; Klamath dollars obligated: 0; Total dollars obligated: 38,426,358; Percentage of total: 4.82. Practice name/payment type: Nutrient management; Number[A]: 28,203; EQIP dollars obligated: 31,364,894; Ground and Surface Water Conservation dollars obligated: 202,457; Klamath dollars obligated: 0; Total dollars obligated: 31,567,351; Percentage of total: 3.96. Practice name/payment type: Pipeline; Number[A]: 10,337; EQIP dollars obligated: 30,219,008; Ground and Surface Water Conservation dollars obligated: 13,115; Klamath dollars obligated: 1,350; Total dollars obligated: 30,233,473; Percentage of total: 3.79. Practice name/payment type: Irrigation water conveyance, pipeline, high pressure, underground, plastic; Number[A]: 2,911; EQIP dollars obligated: 21,842,555; Ground and Surface Water Conservation dollars obligated: 3,850,154; Klamath dollars obligated: 1,453,781; Total dollars obligated: 27,146,491; Percentage of total: 3.41. Practice name/payment type: Irrigation system, trickle; Number[A]: 1,321; EQIP dollars obligated: 16,623,856; Ground and Surface Water Conservation dollars obligated: 9,606,358; Klamath dollars obligated: 0; Total dollars obligated: 26,230,214; Percentage of total: 3.29. Practice name/payment type: Pasture and hayland planting; Number[A]: 11,582; EQIP dollars obligated: 23,856,494; Ground and Surface Water Conservation dollars obligated: 118,962; Klamath dollars obligated: 0; Total dollars obligated: 23,975,456; Percentage of total: 3.01. Practice name/payment type: Pest management; Number[A]: 19,190; EQIP dollars obligated: 22,803,131; Ground and Surface Water Conservation dollars obligated: 227,884; Klamath dollars obligated: 0; Total dollars obligated: 23,031,015; Percentage of total: 2.89. Practice name/payment type: Heavy use area protection; Number[A]: 4,689; EQIP dollars obligated: 22,119,580; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 22,119,580; Percentage of total: 2.77. Practice name/payment type: Residue management, no till and strip till; Number[A]: 8,355; EQIP dollars obligated: 21,516,049; Ground and Surface Water Conservation dollars obligated: 281,657; Klamath dollars obligated: 0; Total dollars obligated: 21,797,706; Percentage of total: 2.73. Practice name/payment type: Trough or tank; Number[A]: 13,770; EQIP dollars obligated: 20,854,462; Ground and Surface Water Conservation dollars obligated: 15,177; Klamath dollars obligated: 1,875; Total dollars obligated: 20,871,514; Percentage of total: 2.62. Practice name/payment type: Prescribed grazing; Number[A]: 12,736; EQIP dollars obligated: 17,266,545; Ground and Surface Water Conservation dollars obligated: 285,858; Klamath dollars obligated: 537,144; Total dollars obligated: 18,089,547; Percentage of total: 2.27. Practice name/payment type: Grade stabilization structure; Number[A]: 3,630; EQIP dollars obligated: 15,101,275; Ground and Surface Water Conservation dollars obligated: 54,118; Klamath dollars obligated: 9,000; Total dollars obligated: 15,164,393; Percentage of total: 1.90. Practice name/payment type: Residue management, mulch till; Number[A]: 3,397; EQIP dollars obligated: 14,289,883; Ground and Surface Water Conservation dollars obligated: 185,416; Klamath dollars obligated: 0; Total dollars obligated: 14,475,299; Percentage of total: 1.82. Practice name/payment type: Well; Number[A]: 3,275; EQIP dollars obligated: 12,745,858; Ground and Surface Water Conservation dollars obligated: 56,865; Klamath dollars obligated: 0; Total dollars obligated: 12,802,723; Percentage of total: 1.61. Practice name/payment type: Irrigation water conveyance, pipeline, low pressure underground, plastic; Number[A]: 1,447; EQIP dollars obligated: 8,916,088; Ground and Surface Water Conservation dollars obligated: 2,329,292; Klamath dollars obligated: 1,428,530; Total dollars obligated: 12,673,910; Percentage of total: 1.59. Practice name/payment type: Manure transfer; Number[A]: 1,223; EQIP dollars obligated: 11,800,218; Ground and Surface Water Conservation dollars obligated: 57,660; Klamath dollars obligated: 0; Total dollars obligated: 11,857,878; Percentage of total: 1.49. Practice name/payment type: Pond; Number[A]: 4,006; EQIP dollars obligated: 11,375,676; Ground and Surface Water Conservation dollars obligated: 31,678; Klamath dollars obligated: 0; Total dollars obligated: 11,407,354; Percentage of total: 1.43. Practice name/payment type: Irrigation land leveling; Number[A]: 1,190; EQIP dollars obligated: 9,387,978; Ground and Surface Water Conservation dollars obligated: 1,966,210; Klamath dollars obligated: 9,600; Total dollars obligated: 11,363,788; Percentage of total: 1.43. Practice name/payment type: Terrace; Number[A]: 2,961; EQIP dollars obligated: 11,340,023; Ground and Surface Water Conservation dollars obligated: 11,870; Klamath dollars obligated: 0; Total dollars obligated: 11,351,893; Percentage of total: 1.42. Practice name/payment type: Structure for water control; Number[A]: 3,456; EQIP dollars obligated: 8,323,788; Ground and Surface Water Conservation dollars obligated: 2,217,993; Klamath dollars obligated: 325,373; Total dollars obligated: 10,867,154; Percentage of total: 1.36. Practice name/payment type: Underground outlet; Number[A]: 2,811; EQIP dollars obligated: 8,702,037; Ground and Surface Water Conservation dollars obligated: 124,150; Klamath dollars obligated: 0; Total dollars obligated: 8,826,187; Percentage of total: 1.11. Practice name/payment type: Pumping plant for water control; Number[A]: 2,203; EQIP dollars obligated: 7,287,132; Ground and Surface Water Conservation dollars obligated: 878,852; Klamath dollars obligated: 591,736; Total dollars obligated: 8,757,720; Percentage of total: 1.10. Practice name/payment type: Forest stand improvement; Number[A]: 2,772; EQIP dollars obligated: 8,612,338; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 47,520; Total dollars obligated: 8,659,858; Percentage of total: 1.09. Practice name/payment type: Conservation crop rotation; Number[A]: 2,682; EQIP dollars obligated: 2,579,277; Ground and Surface Water Conservation dollars obligated: 6,072,364; Klamath dollars obligated: 0; Total dollars obligated: 8,651,641; Percentage of total: 1.09. Practice name/payment type: Composting facility; Number[A]: 513; EQIP dollars obligated: 8,061,771; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 8,061,771; Percentage of total: 1.01. Practice name/payment type: Grassed waterway; Number[A]: 2,635; EQIP dollars obligated: 7,071,664; Ground and Surface Water Conservation dollars obligated: 5,096; Klamath dollars obligated: 0; Total dollars obligated: 7,076,760; Percentage of total: 0.89. Practice name/payment type: Irrigation water management; Number[A]: 5,319; EQIP dollars obligated: 3,694,001; Ground and Surface Water Conservation dollars obligated: 2,844,830; Klamath dollars obligated: 250,556; Total dollars obligated: 6,789,387; Percentage of total: 0.85. Practice name/payment type: Water and sediment control basin; Number[A]: 1,732; EQIP dollars obligated: 6,531,431; Ground and Surface Water Conservation dollars obligated: 20,100; Klamath dollars obligated: 0; Total dollars obligated: 6,551,531; Percentage of total: 0.82. Practice name/payment type: Waste utilization; Number[A]: 2,245; EQIP dollars obligated: 5,751,350; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 5,751,350; Percentage of total: 0.72. Practice name/payment type: Tree/shrub establishment; Number[A]: 2,618; EQIP dollars obligated: 5,355,933; Ground and Surface Water Conservation dollars obligated: 5,739; Klamath dollars obligated: 23,835; Total dollars obligated: 5,385,507; Percentage of total: 0.68. Practice name/payment type: Cover crop; Number[A]: 2,997; EQIP dollars obligated: 5,150,505; Ground and Surface Water Conservation dollars obligated: 224,470; Klamath dollars obligated: 1,440; Total dollars obligated: 5,376,415; Percentage of total: 0.67. Practice name/payment type: Range planting; Number[A]: 1,810; EQIP dollars obligated: 5,221,400; Ground and Surface Water Conservation dollars obligated: 151,840; Klamath dollars obligated: 315; Total dollars obligated: 5,373,555; Percentage of total: 0.67. Practice name/payment type: Atmospheric resource quality management; Number[A]: 2,150; EQIP dollars obligated: 5,308,280; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 5,308,280; Percentage of total: 0.67. Practice name/payment type: Access road; Number[A]: 1,067; EQIP dollars obligated: 4,673,395; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 3,750; Total dollars obligated: 4,677,145; Percentage of total: 0.59. Practice name/payment type: Irrigation water conveyance, ditch and canal, nonreinforced concrete; Number[A]: 324; EQIP dollars obligated: 3,718,626; Ground and Surface Water Conservation dollars obligated: 805,511; Klamath dollars obligated: 0; Total dollars obligated: 4,524,137; Percentage of total: 0.57. Practice name/payment type: Streambank and shoreline protection; Number[A]: 502; EQIP dollars obligated: 4,467,492; Ground and Surface Water Conservation dollars obligated: 15,486; Klamath dollars obligated: 15,000; Total dollars obligated: 4,497,978; Percentage of total: 0.56. Practice name/payment type: Agrochemical mixing facility[B]; Number[A]: 379; EQIP dollars obligated: 4,436,661; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 4,436,661; Percentage of total: 0.56. Practice name/payment type: Wastewater and feedlot runoff control[B]; Number[A]: 98; EQIP dollars obligated: 3,750,526; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 3,750,526; Percentage of total: 0.47. Practice name/payment type: Forest site preparation; Number[A]: 1,609; EQIP dollars obligated: 3,728,573; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 3,728,573; Percentage of total: 0.47. Practice name/payment type: Critical area planting; Number[A]: 5,204; EQIP dollars obligated: 3,016,223; Ground and Surface Water Conservation dollars obligated: 38,433; Klamath dollars obligated: 1,125; Total dollars obligated: 3,055,781; Percentage of total: 0.38. Practice name/payment type: Incentive payment for comprehensive nutrient management plan; Number[A]: 1,423; EQIP dollars obligated: 3,049,132; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 3,049,132; Percentage of total: 0.38. Practice name/payment type: Subsurface drain; Number[A]: 722; EQIP dollars obligated: 2,967,580; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,967,580; Percentage of total: 0.37. Practice name/payment type: Sediment basin; Number[A]: 322; EQIP dollars obligated: 2,744,387; Ground and Surface Water Conservation dollars obligated: 1,645; Klamath dollars obligated: 0; Total dollars obligated: 2,746,032; Percentage of total: 0.34. Practice name/payment type: Waste treatment lagoon; Number[A]: 333; EQIP dollars obligated: 2,072,400; Ground and Surface Water Conservation dollars obligated: 630,734; Klamath dollars obligated: 0; Total dollars obligated: 2,703,134; Percentage of total: 0.34. Practice name/payment type: Irrigation water conveyance, pipeline, rigid gated pipeline; Number[A]: 737; EQIP dollars obligated: 2,396,798; Ground and Surface Water Conservation dollars obligated: 156,156; Klamath dollars obligated: 63,362; Total dollars obligated: 2,616,316; Percentage of total: 0.33. Practice name/payment type: Closure of waste impoundment; Number[A]: 137; EQIP dollars obligated: 2,428,288; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,428,288; Percentage of total: 0.33. Practice name/payment type: Residue management, direct seed[B]; Number[A]: 638; EQIP dollars obligated: 2,404,419; Ground and Surface Water Conservation dollars obligated: 5,000; Klamath dollars obligated: 0; Total dollars obligated: 2,409,419; Percentage of total: 0.30. Practice name/payment type: Diversion; Number[A]: 1,068; EQIP dollars obligated: 2,264,307; Ground and Surface Water Conservation dollars obligated: 1,380; Klamath dollars obligated: 0; Total dollars obligated: 2,265,687; Percentage of total: 0.28. Practice name/payment type: Prescribed burning; Number[A]: 1,763; EQIP dollars obligated: 2,243,540; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,243,540; Percentage of total: 0.28. Practice name/payment type: Irrigation system, tailwater recovery; Number[A]: 172; EQIP dollars obligated: 1,675,379; Ground and Surface Water Conservation dollars obligated: 429,927; Klamath dollars obligated: 13,500; Total dollars obligated: 2,118,806; Percentage of total: 0.27. Practice name/payment type: Use exclusion; Number[A]: 1,264; EQIP dollars obligated: 2,116,869; Ground and Surface Water Conservation dollars obligated: 1,770; Klamath dollars obligated: 0; Total dollars obligated: 2,118,639; Percentage of total: 0.27. Practice name/payment type: Animal trails and walkways; Number[A]: 545; EQIP dollars obligated: 2,007,572; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,007,572; Percentage of total: 0.25. Practice name/payment type: Spring development; Number[A]: 1,278; EQIP dollars obligated: 1,984,575; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,984,575; Percentage of total: 0.25. Practice name/payment type: Windbreak/shelterbreak establishment; Number[A]: 1,277; EQIP dollars obligated: 1,796,732; Ground and Surface Water Conservation dollars obligated: 21,978; Klamath dollars obligated: 0; Total dollars obligated: 1,818,710; Percentage of total: 0.23. Practice name/payment type: Long term no till[B]; Number[A]: 463; EQIP dollars obligated: 1,717,823; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,717,823; Percentage of total: 0.22. Practice name/payment type: Stream crossing[B]; Number[A]: 668; EQIP dollars obligated: 1,617,152; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,617,152; Percentage of total: 0.20. Practice name/payment type: Irrigation storage reservoir; Number[A]: 69; EQIP dollars obligated: 739,821; Ground and Surface Water Conservation dollars obligated: 815,416; Klamath dollars obligated: 0; Total dollars obligated: 1,555,237; Percentage of total: 0.20. Practice name/payment type: Reimbursement for technical service provider, design; Number[A]: 2,862; EQIP dollars obligated: 1,516,129; Ground and Surface Water Conservation dollars obligated: 36,669; Klamath dollars obligated: 0; Total dollars obligated: 1,552,797; Percentage of total: 0.19. Practice name/payment type: Pond sealing or lining, flexible membrane; Number[A]: 56; EQIP dollars obligated: 1,548,195; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,548,195; Percentage of total: 0.19. Practice name/payment type: Roof runoff management; Number[A]: 729; EQIP dollars obligated: 1,542,321; Ground and Surface Water Conservation dollars obligated: 1,500; Klamath dollars obligated: 0; Total dollars obligated: 1,543,821; Percentage of total: 0.19. Practice name/payment type: Alum treatment of poultry litter[B]; Number[A]: 603; EQIP dollars obligated: 1,207,459; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,207,459; Percentage of total: 0.15. Practice name/payment type: Irrigation regulating reservoir; Number[A]: 165; EQIP dollars obligated: 944,204; Ground and Surface Water Conservation dollars obligated: 250,180; Klamath dollars obligated: 0; Total dollars obligated: 1,194,384; Percentage of total: 0.15. Practice name/payment type: Wildlife upland habitat management; Number[A]: 1,285; EQIP dollars obligated: 1,167,347; Ground and Surface Water Conservation dollars obligated: 22,897; Klamath dollars obligated: 0; Total dollars obligated: 1,190,244; Percentage of total: 0.15. Practice name/payment type: Animal mortality facility; Number[A]: 242; EQIP dollars obligated: 1,144,067; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,144,067; Percentage of total: 0.14. Practice name/payment type: Open channel; Number[A]: 32; EQIP dollars obligated: 983,142; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 983,142; Percentage of total: 0.12. Practice name/payment type: Lined waterway or outlet; Number[A]: 166; EQIP dollars obligated: 955,446; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 955,446; Percentage of total: 0.12. Practice name/payment type: Firebreak; Number[A]: 601; EQIP dollars obligated: 919,207; Ground and Surface Water Conservation dollars obligated: 8,280; Klamath dollars obligated: 0; Total dollars obligated: 927,487; Percentage of total: 0.12. Practice name/payment type: Irrigation system, surface and subsurface; Number[A]: 132; EQIP dollars obligated: 667,096; Ground and Surface Water Conservation dollars obligated: 236,679; Klamath dollars obligated: 0; Total dollars obligated: 903,775; Percentage of total: 0.11. Practice name/payment type: Forest harvest trails and landings; Number[A]: 249; EQIP dollars obligated: 866,311; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 866,311; Percentage of total: 0.11. Practice name/payment type: Residue management, seasonal; Number[A]: 298; EQIP dollars obligated: 801,742; Ground and Surface Water Conservation dollars obligated: 10,122; Klamath dollars obligated: 0; Total dollars obligated: 811,864; Percentage of total: 0.10. Practice name/payment type: Irrigation water conveyance, pipeline, unspecified type; Number[A]: 125; EQIP dollars obligated: 681,791; Ground and Surface Water Conservation dollars obligated: 72,246; Klamath dollars obligated: 0; Total dollars obligated: 754,037; Percentage of total: 0.09. Practice name/payment type: Reimbursement for technical service provider, construction; Number[A]: 1,864; EQIP dollars obligated: 709,354; Ground and Surface Water Conservation dollars obligated: 7,626; Klamath dollars obligated: 0; Total dollars obligated: 716,981; Percentage of total: 0.09. Practice name/payment type: Obstruction removal; Number[A]: 207; EQIP dollars obligated: 697,581; Ground and Surface Water Conservation dollars obligated: 5,550; Klamath dollars obligated: 0; Total dollars obligated: 703,131; Percentage of total: 0.09. Practice name/payment type: Mulching; Number[A]: 568; EQIP dollars obligated: 677,376; Ground and Surface Water Conservation dollars obligated: 12,475; Klamath dollars obligated: 0; Total dollars obligated: 689,851; Percentage of total: 0.09. Practice name/payment type: Pond sealing or lining, bentonite; Number[A]: 54; EQIP dollars obligated: 676,910; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 676,910; Percentage of total: 0.08. Practice name/payment type: Wildlife habitat restoration and management; Number[A]: 238; EQIP dollars obligated: 613,289; Ground and Surface Water Conservation dollars obligated: 1,065; Klamath dollars obligated: 0; Total dollars obligated: 614,354; Percentage of total: 0.08. Practice name/payment type: Wastewater, milkhouse treatment system[B]; Number[A]: 30; EQIP dollars obligated: 586,991; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 586,991; Percentage of total: 0.07. Practice name/payment type: Water harvesting catchment; Number[A]: 49; EQIP dollars obligated: 436,851; Ground and Surface Water Conservation dollars obligated: 148,500; Klamath dollars obligated: 0; Total dollars obligated: 585,351; Percentage of total: 0.07. Practice name/payment type: Storm water wet detention/chemical treatment system[B]; Number[A]: 3; EQIP dollars obligated: 581,251; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 581,251; Percentage of total: 0.07. Practice name/payment type: Field border; Number[A]: 724; EQIP dollars obligated: 524,775; Ground and Surface Water Conservation dollars obligated: 4,860; Klamath dollars obligated: 0; Total dollars obligated: 529,635; Percentage of total: 0.07. Practice name/payment type: Filter strips; Number[A]: 801; EQIP dollars obligated: 527,986; Ground and Surface Water Conservation dollars obligated: 1,550; Klamath dollars obligated: 0; Total dollars obligated: 529,536; Percentage of total: 0.07. Practice name/payment type: Toxic salt reduction; Number[A]: 223; EQIP dollars obligated: 528,113; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 528,113; Percentage of total: 0.07. Practice name/payment type: Precision land forming; Number[A]: 57; EQIP dollars obligated: 527,826; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 527,826; Percentage of total: 0.07. Practice name/payment type: Riparian forest buffer; Number[A]: 453; EQIP dollars obligated: 469,753; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 2,250; Total dollars obligated: 472,003; Percentage of total: 0.06. Practice name/payment type: Land smoothing; Number[A]: 223; EQIP dollars obligated: 434,267; Ground and Surface Water Conservation dollars obligated: 3,688; Klamath dollars obligated: 7,628; Total dollars obligated: 445,583; Percentage of total: 0.06. Practice name/payment type: Well decommissioning; Number[A]: 484; EQIP dollars obligated: 429,531; Ground and Surface Water Conservation dollars obligated: 15,286; Klamath dollars obligated: 0; Total dollars obligated: 444,817; Percentage of total: 0.06. Practice name/payment type: Windbreak/shelterbreak renovation; Number[A]: 228; EQIP dollars obligated: 427,053; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 427,053; Percentage of total: 0.05. Practice name/payment type: Reimbursement for technical service provider, certification; Number[A]: 2,127; EQIP dollars obligated: 410,614; Ground and Surface Water Conservation dollars obligated: 11,466; Klamath dollars obligated: 0; Total dollars obligated: 422,079; Percentage of total: 0.05. Practice name/payment type: Dike; Number[A]: 95; EQIP dollars obligated: 418,129; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 418,129; Percentage of total: 0.05. Practice name/payment type: Incinerator[B]; Number[A]: 72; EQIP dollars obligated: 409,113; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 409,113; Percentage of total: 0.05. Practice name/payment type: Reimbursement for technical service provider, planning; Number[A]: 282; EQIP dollars obligated: 389,035; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 389,035; Percentage of total: 0.05. Practice name/payment type: Animal use area protection[B]; Number[A]: 107; EQIP dollars obligated: 388,377; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 388,377; Percentage of total: 0.05. Practice name/payment type: Hedgerow planting; Number[A]: 111; EQIP dollars obligated: 376,818; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 376,818; Percentage of total: 0.05. Practice name/payment type: Tree/shrub pruning; Number[A]: 253; EQIP dollars obligated: 358,758; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 358,758; Percentage of total: 0.04. Practice name/payment type: Barnyard runoff management[B]; Number[A]: 19; EQIP dollars obligated: 344,198; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 344,198; Percentage of total: 0.04. Practice name/payment type: Feed management; Number[A]: 287; EQIP dollars obligated: 327,729; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 327,729; Percentage of total: 0.04. Practice name/payment type: Conservation cover; Number[A]: 489; EQIP dollars obligated: 302,024; Ground and Surface Water Conservation dollars obligated: 10,041; Klamath dollars obligated: 0; Total dollars obligated: 312,065; Percentage of total: 0.04. Practice name/payment type: Chiseling and subsoiling; Number[A]: 228; EQIP dollars obligated: 305,754; Ground and Surface Water Conservation dollars obligated: 4,800; Klamath dollars obligated: 0; Total dollars obligated: 310,554; Percentage of total: 0.04. Practice name/payment type: Wildlife habitat, early successional; Number[A]: 362; EQIP dollars obligated: 310,026; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 310,026; Percentage of total: 0.04. Practice name/payment type: Anaerobic digester, ambient temperature; Number[A]: 2; EQIP dollars obligated: 300,001; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 300,001; Percentage of total: 0.04. Practice name/payment type: Residue management; Number[A]: 184; EQIP dollars obligated: 284,296; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 284,296; Percentage of total: 0.04. Practice name/payment type: Fish passage; Number[A]: 22; EQIP dollars obligated: 262,056; Ground and Surface Water Conservation dollars obligated: 7,789; Klamath dollars obligated: 9,911; Total dollars obligated: 279,756; Percentage of total: 0.04. Practice name/payment type: Surface drainage, main or lateral; Number[A]: 15; EQIP dollars obligated: 263,977; Ground and Surface Water Conservation dollars obligated: 3,411; Klamath dollars obligated: 0; Total dollars obligated: 267,388; Percentage of total: 0.03. Practice name/payment type: Wastewater treatment strip; Number[A]: 98; EQIP dollars obligated: 261,499; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 261,499; Percentage of total: 0.03. Practice name/payment type: Irrigation water conveyance, pipeline, steel; Number[A]: 97; EQIP dollars obligated: 226,747; Ground and Surface Water Conservation dollars obligated: 23,293; Klamath dollars obligated: 1,200; Total dollars obligated: 251,240; Percentage of total: 0.03. Practice name/payment type: Shellfish aquaculture management[B]; Number[A]: 63; EQIP dollars obligated: 247,909; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 247,909; Percentage of total: 0.03. Practice name/payment type: Irrigation water conveyance, pipeline, nonreinforced concrete; Number[A]: 14; EQIP dollars obligated: 240,950; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 240,950; Percentage of total: 0.03. Practice name/payment type: Closure of waste impoundment[B]; Number[A]: 91; EQIP dollars obligated: 224,816; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 224,816; Percentage of total: 0.03. Practice name/payment type: Fish stream improvement; Number[A]: 34; EQIP dollars obligated: 202,469; Ground and Surface Water Conservation dollars obligated: 1,006; Klamath dollars obligated: 0; Total dollars obligated: 203,475; Percentage of total: 0.03. Practice name/payment type: Aquaculture ponds; Number[A]: 200; EQIP dollars obligated: 6,000; Ground and Surface Water Conservation dollars obligated: 196,524; Klamath dollars obligated: 0; Total dollars obligated: 202,524; Percentage of total: 0.03. Practice name/payment type: Anaerobic digester, controlled temperature; Number[A]: 5; EQIP dollars obligated: 195,000; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 195,000; Percentage of total: 0.02. Practice name/payment type: Agricultural fuel containment facility[B]; Number[A]: 63; EQIP dollars obligated: 194,607; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 194,607; Percentage of total: 0.02. Practice name/payment type: Stream channel stabilization; Number[A]: 26; EQIP dollars obligated: 185,418; Ground and Surface Water Conservation dollars obligated: 200; Klamath dollars obligated: 0; Total dollars obligated: 185,618; Percentage of total: 0.02. Practice name/payment type: Pond sealing or lining, soil dispersant; Number[A]: 30; EQIP dollars obligated: 171,387; Ground and Surface Water Conservation dollars obligated: 5,370; Klamath dollars obligated: 0; Total dollars obligated: 176,757; Percentage of total: 0.02. Practice name/payment type: Irrigation field ditch; Number[A]: 55; EQIP dollars obligated: 175,048; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 175,048; Percentage of total: 0.02. Practice name/payment type: Residue management, ridge till; Number[A]: 97; EQIP dollars obligated: 146,536; Ground and Surface Water Conservation dollars obligated: 150; Klamath dollars obligated: 0; Total dollars obligated: 146,686; Percentage of total: 0.02. Practice name/payment type: Transition to organic production[B]; Number[A]: 99; EQIP dollars obligated: 132,781; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 132,781; Percentage of total: 0.02. Practice name/payment type: Forage harvest management; Number[A]: 154; EQIP dollars obligated: 62,461; Ground and Surface Water Conservation dollars obligated: 66,996; Klamath dollars obligated: 0; Total dollars obligated: 129,457; Percentage of total: 0.02. Practice name/payment type: Shallow water for wildlife; Number[A]: 162; EQIP dollars obligated: 101,607; Ground and Surface Water Conservation dollars obligated: 14,627; Klamath dollars obligated: 0; Total dollars obligated: 116,234; Percentage of total: 0.01. Practice name/payment type: Wetland restoration; Number[A]: 40; EQIP dollars obligated: 115,663; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 115,663; Percentage of total: 0.01. Practice name/payment type: Dam, floodwater retarding; Number[A]: 13; EQIP dollars obligated: 115,385; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 115,385; Percentage of total: 0.01. Practice name/payment type: Clearing and snagging; Number[A]: 12; EQIP dollars obligated: 106,250; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 106,250; Percentage of total: 0.01. Practice name/payment type: Digester, complete mix[B]; Number[A]: 13; EQIP dollars obligated: 105,600; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 105,600; Percentage of total: 0.01. Practice name/payment type: Dam, diversion; Number[A]: 25; EQIP dollars obligated: 96,877; Ground and Surface Water Conservation dollars obligated: 6,330; Klamath dollars obligated: 0; Total dollars obligated: 103,207; Percentage of total: 0.01. Practice name/payment type: Wildlife watering facility; Number[A]: 141; EQIP dollars obligated: 88,417; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 88,417; Percentage of total: 0.01. Practice name/payment type: Wetland enhancement; Number[A]: 31; EQIP dollars obligated: 79,020; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 79,020; Percentage of total: 0.01. Practice name/payment type: Grazing land mechanical treatment; Number[A]: 68; EQIP dollars obligated: 74,389; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 74,389; Percentage of total: 0.01. Practice name/payment type: Solid/liquid waste separation facility; Number[A]: 1; EQIP dollars obligated: 72,000; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 72,000; Percentage of total: 0.01. Practice name/payment type: Contour farming; Number[A]: 129; EQIP dollars obligated: 69,690; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 69,690; Percentage of total: 0.01. Practice name/payment type: Livestock shade structure[B]; Number[A]: 23; EQIP dollars obligated: 67,146; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 67,146; Percentage of total: 0.01. Practice name/payment type: Stripcropping, contour; Number[A]: 63; EQIP dollars obligated: 65,270; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 65,270; Percentage of total: 0.01. Practice name/payment type: Silage leachate collection and transfer[B]; Number[A]: 2; EQIP dollars obligated: 65,190; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 65,190; Percentage of total: 0.01. Practice name/payment type: Hillside ditch; Number[A]: 34; EQIP dollars obligated: 57,056; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 57,056; Percentage of total: 0.01. Practice name/payment type: Irrigation water conveyance, pipeline, aluminum tubing; Number[A]: 9; EQIP dollars obligated: 15,995; Ground and Surface Water Conservation dollars obligated: 2,250; Klamath dollars obligated: 35,412; Total dollars obligated: 53,657; Percentage of total: 0.01. Practice name/payment type: Land clearing; Number[A]: 59; EQIP dollars obligated: 50,970; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 50,970; Percentage of total: 0.01. Practice name/payment type: Digester, plug flow[B]; Number[A]: 13; EQIP dollars obligated: 49,500; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 49,500; Percentage of total: 0.01. Practice name/payment type: Cross wind ridges; Number[A]: 33; EQIP dollars obligated: 45,956; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 45,956; Percentage of total: 0.01. Practice name/payment type: Farm evaluation[B]; Number[A]: 42; EQIP dollars obligated: 45,500; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 45,500; Percentage of total: 0.01. Practice name/payment type: Pond sealing or lining, unspecified type; Number[A]: 6; EQIP dollars obligated: 42,495; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 42,495; Percentage of total: 0.01. Practice name/payment type: Riparian herbaceous buffer; Number[A]: 70; EQIP dollars obligated: 41,440; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 41,440; Percentage of total: 0.01. Practice name/payment type: Fuel break; Number[A]: 17; EQIP dollars obligated: 38,556; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 38,556; Percentage of total: 0.00. Practice name/payment type: Pathogen management[B]; Number[A]: 69; EQIP dollars obligated: 34,500; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 34,500; Percentage of total: 0.00. Practice name/payment type: Waste field storage area[B]; Number[A]: 11; EQIP dollars obligated: 31,874; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 31,874; Percentage of total: 0.00. Practice name/payment type: Waterspreading; Number[A]: 6; EQIP dollars obligated: 31,264; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 31,264; Percentage of total: 0.00. Practice name/payment type: Fish raceway or tank; Number[A]: 1; EQIP dollars obligated: 27,125; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 27,125; Percentage of total: 0.00. Practice name/payment type: Irrigation canal or lateral; Number[A]: 4; EQIP dollars obligated: 25,157; Ground and Surface Water Conservation dollars obligated: 1,406; Klamath dollars obligated: 0; Total dollars obligated: 26,563; Percentage of total: 0.00. Practice name/payment type: Temporary steel work[B]; Number[A]: 6; EQIP dollars obligated: 25,416; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 25,416; Percentage of total: 0.00. Practice name/payment type: Contour orchard and other fruit area; Number[A]: 130; EQIP dollars obligated: 24,796; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 24,796; Percentage of total: 0.00. Practice name/payment type: Wetland, constructed; Number[A]: 5; EQIP dollars obligated: 23,621; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 23,621; Percentage of total: 0.00. Practice name/payment type: Vegetative barrier; Number[A]: 13; EQIP dollars obligated: 22,494; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 22,494; Percentage of total: 0.00. Practice name/payment type: Alley cropping; Number[A]: 86; EQIP dollars obligated: 21,963; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 21,963; Percentage of total: 0.00. Practice name/payment type: Regulating water in drainage systems; Number[A]: 13; EQIP dollars obligated: 19,466; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 19,466; Percentage of total: 0.00. Practice name/payment type: Surface roughening; Number[A]: 11; EQIP dollars obligated: 18,207; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 18,207; Percentage of total: 0.00. Practice name/payment type: Irrigation water conveyance, ditch and canal, flexible membrane; Number[A]: 8; EQIP dollars obligated: 913; Ground and Surface Water Conservation dollars obligated: 16,359; Klamath dollars obligated: 0; Total dollars obligated: 17,272; Percentage of total: 0.00. Practice name/payment type: Channel vegetation; Number[A]: 15; EQIP dollars obligated: 14,730; Ground and Surface Water Conservation dollars obligated: 2,400; Klamath dollars obligated: 0; Total dollars obligated: 17,130; Percentage of total: 0.00. Practice name/payment type: Sinkhole treatment[B]; Number[A]: 10; EQIP dollars obligated: 13,988; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 13,988; Percentage of total: 0.00. Practice name/payment type: Irrigation water conveyance, ditch and canal, unspecified type; Number[A]: 2; EQIP dollars obligated: 13,260; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 13,260; Percentage of total: 0.00. Practice name/payment type: Vertical drain; Number[A]: 12; EQIP dollars obligated: 13,251; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 13,251; Percentage of total: 0.00. Practice name/payment type: Recreation trail and walkway; Number[A]: 1; EQIP dollars obligated: 13,000; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 13,000; Percentage of total: 0.00. Practice name/payment type: Wildlife wetland habitat management; Number[A]: 71; EQIP dollars obligated: 11,860; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 11,860; Percentage of total: 0.00. Practice name/payment type: Waste facility cover; Number[A]: 1; EQIP dollars obligated: 10,080; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 10,080; Percentage of total: 0.00. Practice name/payment type: Contour buffer strips; Number[A]: 26; EQIP dollars obligated: 10,052; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 10,052; Percentage of total: 0.00. Practice name/payment type: Soil salinity management, nonirrigated; Number[A]: 24; EQIP dollars obligated: 9,390; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 9,390; Percentage of total: 0.00. Practice name/payment type: Spoil spreading; Number[A]: 5; EQIP dollars obligated: 9,021; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 9,021; Percentage of total: 0.00. Practice name/payment type: Surface drainage, field ditch; Number[A]: 16; EQIP dollars obligated: 7,010; Ground and Surface Water Conservation dollars obligated: 870; Klamath dollars obligated: 0; Total dollars obligated: 7,880; Percentage of total: 0.00. Practice name/payment type: Well testing[B]; Number[A]: 36; EQIP dollars obligated: 7,560; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 7,560; Percentage of total: 0.00. Practice name/payment type: Herbaceous wind barriers; Number[A]: 13; EQIP dollars obligated: 7,139; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 7,139; Percentage of total: 0.00. Practice name/payment type: Wetland creation; Number[A]: 5; EQIP dollars obligated: 6,990; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 6,990; Percentage of total: 0.00. Practice name/payment type: Pasture and hayland management; Number[A]: 3; EQIP dollars obligated: 5,898; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 5,898; Percentage of total: 0.00. Practice name/payment type: Monitoring well; Number[A]: 1; EQIP dollars obligated: 4,875; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 4,875; Percentage of total: 0.00. Practice name/payment type: Invasive plant species control[B]; Number[A]: 4; EQIP dollars obligated: 4,292; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 4,292; Percentage of total: 0.00. Practice name/payment type: Row arrangement; Number[A]: 3; EQIP dollars obligated: 3,126; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 3,126; Percentage of total: 0.00. Practice name/payment type: Infiltration ditches[B]; Number[A]: 8; EQIP dollars obligated: 2,768; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,768; Percentage of total: 0.00. Practice name/payment type: Air management[B]; Number[A]: 4; EQIP dollars obligated: 2,570; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,570; Percentage of total: 0.00. Practice name/payment type: Anionic polyacrylamide erosion control; Number[A]: 5; EQIP dollars obligated: 2,359; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,359; Percentage of total: 0.00. Practice name/payment type: Soil salinity control[B]; Number[A]: 4; EQIP dollars obligated: 2,232; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,232; Percentage of total: 0.00. Practice name/payment type: Cross wind trap strips; Number[A]: 2; EQIP dollars obligated: 2,030; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 2,030; Percentage of total: 0.00. Practice name/payment type: Silvopasture establishment; Number[A]: 3; EQIP dollars obligated: 1,890; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,890; Percentage of total: 0.00. Practice name/payment type: Cross wind stripcropping; Number[A]: 3; EQIP dollars obligated: 1,440; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,440; Percentage of total: 0.00. Practice name/payment type: Irrigation water conveyance, pipeline, reinforced plastic mortar; Number[A]: 2; EQIP dollars obligated: 1,260; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 1,260; Percentage of total: 0.00. Practice name/payment type: Cistern[B]; Number[A]: 1; EQIP dollars obligated: 750; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 750; Percentage of total: 0.00. Practice name/payment type: Irrigation water conveyance, pipeline, corrugated metal pipeline; Number[A]: 2; EQIP dollars obligated: 0; Ground and Surface Water Conservation dollars obligated: 12; Klamath dollars obligated: 527; Total dollars obligated: 539; Percentage of total: 0.00. Practice name/payment type: Snow harvesting[B]; Number[A]: 2; EQIP dollars obligated: 500; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 500; Percentage of total: 0.00. Practice name/payment type: Dry hydrant; Number[A]: 1; EQIP dollars obligated: 373; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 373; Percentage of total: 0.00. Practice name/payment type: Water well testing; Number[A]: 1; EQIP dollars obligated: 50; Ground and Surface Water Conservation dollars obligated: 0; Klamath dollars obligated: 0; Total dollars obligated: 50; Percentage of total: 0.00. Practice name/payment type: Total[C]; Number[A]: 248,998; EQIP dollars obligated: $738,429,353; Ground and Surface Water Conservation dollars obligated: $50,729,316; Klamath dollars obligated: $8,091,873; Total dollars obligated: $797,250,542; Percentage of total: 100.00%. Source: GAO analysis of NRCS data. Note: This table only provides data on financial assistance obligations. It does not contain data on technical assistance obligations. The data used were generated in March 2006 and represent obligations as of that date. NRCS said the database from which these data were generated is continually modified as contracts are altered or cancelled. [A] In fiscal year 2005, NRCS entered into 49,406 contracts for the EQIP program. Each contract included one or more practices. This column represents the total number of practices for which EQIP, Ground and Surface Water Conservation, and Klamath Basin funds were obligated. [B] This represents an interim state practice, rather than a national approved practice. Interim state practices are tested by NRCS for 2 years, after which they are approved for national use, extended for further testing, added to an existing state standard, or cancelled. [C] Totals may not add due to rounding. [End of table] [End of section] Appendix VII: Comments from the U. S. Department of Agriculture: United States Department of Agriculture: Natural Resources Conservation Service: P.O. Box 2890: Washington, D.C. 20013: Aug 25 2006: Mr. Daniel Bertoni: Acting Director: Natural Resources and Environment: Government Accountability Office: 441 G Street, N.W. Washington, D.C. 20548: Dear Mr. Bertoni: The Natural Resources Conservation Service (MRCS) appreciates the opportunity to respond to the Government Accountability Office (GAO) draft report, "USDA Should Improve Its Process for Allocating Funds to States for the Environmental Quality Incentives Program (EQIP)." As reflected in the draft report, NRCS acknowledges that the EQIP allocation formula, including weights and data sources, needs review. The report accurately conveys the proactive steps taken by the Agency to re-examine the process for the allocation of EQIP funds to States including: * Planning for a reassessment of the EQIP financial assistance formula; and: * Issuing a request for proposals soliciting for an independent review of all NRCS conservation program allocation formulas and recommendations for changes, enhancements, and new data sources. However, NRCS believes the GAO finding that "the NRCS funding process is not clearly linked to EQIP's purpose of optimizing environmental benefits" is not accurate. The Agency requests that this finding be reconsidered and reworded. The Agency believes that there is a connection between the allocation process, which considers factors related to the natural resource base and the condition of those resources, and optimizing environmental benefits. Some formula data sources and weights will be updated, but the types of factors used would be needed in any process that attempts to inventory natural resource conditions and optimize environmental benefits. It is important to recognize that the EQIP financial assistance formula was never intended to be static. It is updated periodically to reflect new data and changing emphasis in priorities. Additionally, the EQIP allocation process is one of four components considered in optimizing environmental benefits. NRCS' approach to optimize environmental benefits, as described in 7 C.F.R. 1466, integrates consideration of national priorities in four key program components: 1) the allocation of financial resources to States; 2) the location of financial resources within States; 3) the selection of conservation practices and the establishment of cost-share and incentive payment levels; and 4) the application evaluation and ranking process. NRCS would like to re-emphasize the continuing improvement in establishing performance measures to track the benefits produced through EQIP. The Agency first established long-term performance measures for all of its programs, including EQIP, in its 1997 Strategic Plan pursuant to the Government Performance and Results Act of 1993. Since that time, the Agency's process for performance measure establishment and goal setting has become more refined, reflecting improved data and measurement methods. The current EQIP long-term performance measures were developed using a logic model and Agency approval process, and reflect the most recent results of the Agency's effort to track and report program performance. These long-term measures were incorporated into the NRCS Strategic Plan, 2005-2010, to strengthen the reflection of Agency programs in the plan. On an annual basis, EQIP's annual performance and efficiency measures are reported to provide a yearly indication of progress toward the program's long- term objectives. Again, thank you for giving us the opportunity to respond to this draft report. If you have any questions, please contact Lesia Young, Natural Resource Manager, Operations Management and Oversight Division, at (202) 720-6707. Sincerely, Signed by: Arlen L. Lancaster: Chief: cc: June C. Hill, USDA GAO Liaison Manager, Office of the Inspector General Ron Maxon, Assistant Director, Government Accountability Office: [End of section] Appendix VIII: GAO Contact and Staff Acknowledgments: GAO Contact: Daniel Bertoni (202) 512-3841: Staff Acknowledgments: In addition to the individual named above, Ronald E. Maxon, Jr., Assistant Director; William Bates; Thomas Cook; Barbara El Osta; Paige Gilbreath; Lynn Musser; Omari Norman; and Carol Herrnstadt Shulman made key contributions to this report. (360644): FOOTNOTES [1] The Commonwealth of Puerto Rico, the U.S. Virgin Islands, and Pacific Basin territories also receive EQIP assistance. For the purposes of this report, these are referred to as states, with Puerto Rico and the U.S. Virgin Islands considered a single entity under EQIP. [2] Pub. L. No. 107-171, § 2701, 116 Stat. 134, 278 (2002). [3] EQIP money is also provided to states for practices that promote groundwater and surface water conservation, water conservation activities in the Klamath Basin in California and Oregon, salinity control measures in the Colorado River Basin, and through grants to encourage innovative conservation practices. Regional equity funding is provided to ensure all states receive at least $12 million from a total of five USDA conservation programs, including EQIP. In fiscal year 2006, the threshold was lowered administratively to $11 million. [4] Nutrients such as nitrogen and phosphorous often exist in large quantities on farms with animal feeding operations--facilities where animals are fed and raised in confined or semiconfined conditions. [5] Pub. L. No. 104-127, § 334, 110 Stat. 888, 997 (1996). The act combined the Agricultural Conservation Program, Great Plains Conservation Program, Water Quality Incentives Program, and Colorado River Basin Salinity Control Program into the EQIP program. [6] EQIP is funded through USDA's Commodity Credit Corporation. The 2002 Farm Bill authorized $1.2 billion using the funds, facilities, and authorities of the Commodity Credit Corporation to carry out the EQIP program for fiscal year 2006. 16 U.S.C. § 3841(a)(6). However, in the annual appropriations act for fiscal year 2006, Congress capped program funding for EQIP by limiting the amount of funding available to pay salaries and expenses of personnel in carrying out EQIP to $1.017 billion. Pub. L. No. 109-97, § 735, 119 Stat. 2155 (2005). Similarly, for fiscal years 2003 through 2005, Congress has capped funding levels for EQIP at levels below those authorized in the 2002 Farm Bill. [7] The 1996 act required that 50 percent of EQIP funding be targeted at practices relating to livestock production. [8] The act authorized $360 million from 2002 to 2007 for these components of EQIP. [9] Other USDA conservation programs, such as the Conservation Technical Assistance Program, Farm and Ranch Lands Protection Program, and Wildlife Habitat Incentives Program, also use formulas to allocate funding. [10] More specifically, approximately $662.6 million was allocated for general financial assistance in fiscal year 2006. Of that, $652 million was allocated among the 48 continental states. The remainder--$10.6 million--was provided to Alaska, Hawaii, the Pacific Basin, and Puerto Rico and the U.S Virgin Islands--states and territories for which NRCS does not have consistent data reflecting the availability of natural resources and the extent of environmental problems. NRCS allocates money for these states separately from its allocations for the other 48 states. [11] The Conservation Technical Assistance Program provides technical assistance to help people conserve, maintain, and improve their natural resources. [12] The waste management capital cost factor considers the costs associated with animal feeding operations with fewer than 1,000 animal units. It does not include the costs of operations with more than 1,000 animal units. Since 2002, operations with more than 1,000 animal units have been eligible to receive EQIP funding for waste storage facilities. [13] The financial assistance formula allocates 3.5 percent of funds using the waste management capital cost factor and 2.8 percent using the number of concentrated animal feeding operations/animal feeding operations factor. According to NRCS officials, states with animal feeding operations may receive additional funds based on the livestock animal units, animal waste generation, and ratio of animal units to cropland formula factors. [14] We discuss the importance of retrospective economic analysis and its usefulness in managing programs, in GAO, Economic Performance: Highlights of a Workshop on Economic Performance Measures, GAO Workshop, GAO-05-796SP, (Washington, D.C.: July 18, 2005). [15] USDA's report, Model Simulation of Soil Loss, Nutrient Loss, and Change in Soil Organic Carbon Associated with Crop Production, USDA, Conservation Effects Assessment Project, June 2006, estimates nitrogen and phosphorous losses across the country on cropland. [16] Carbon sequestration is the retention of carbon through physical or biological processes that prevent or delay its emission into the atmosphere. For example, conservation tillage leaves more crop residue on land and retains more carbon than many traditional cultivation practices. Sequestering carbon may help mitigate climate change by reducing the amount of carbon dioxide in the atmosphere. [17] For nine of these factors, NRCS provided documentation that allowed us to verify data for all but two states. However, this documentation did not provide sufficient evidence to allow us to verify the source of the data for these factors or understand how the data for these factors were estimated. For one factor, the documentation NRCS provided to corroborate the data used in its financial assistance formula did not match what was used in the formula. [18] Specifically, EQIP regulations (7 C.F.R. § 1466.3) define a limited resource producer as a person with (1) direct or indirect gross farm sales not more than $100,000 in each of the previous 2 years (to be adjusted for inflation) and (2) a total household income at or below the national poverty level for a family of four, or less than 50 percent of county median household income in each of the previous 2 years. [19] In the case of the livestock animal units, animal waste generation, ratio of animal units to cropland, miles of impaired rivers and streams, and ratio of commercial fertilizers to cropland factors, where we were not able to verify the source of the data, we relied on EQIP program officials' statements about when data sources were created to determine if a more current source existed. [20] NRCS's 2003 report, Costs Associated with Development and Implementation of Comprehensive Nutrient Management Plans, estimates the record-keeping, nutrient management, off-farm transport and land treatment costs associated with livestock farms. This data is available on a state-by-state basis. [21] As noted above, the data NRCS uses for the limited resource producers factor has shortcomings. For purposes of demonstrating how changes over time could affect the distribution of general financial assistance, we used the same data NRCS used in its formula--farms with low sales. [22] GAO, Natural Resources Conservation Service: Additional Actions Needed to Strengthen Program and Financial Accountability, GAO/RCED-00- 83 (Washington, D.C.: Apr. 7, 2000). [23] According to the Director of NRCS's Strategic Planning and Performance Division, NRCS has had program-neutral, outcome-based measures in place since 1997 to which EQIP was expected to contribute. [24] State Technical Committees offer advice to NRCS state officials on establishing EQIP activities at the state level. [25] NRCS's Performance Results System can be found at http://ias.sc.egov.usda.gov/prshome/default.html. [26] The following OIG and GAO reports have recently addressed the issue of internal control at NRCS: Audit Report. Natural Resources Conservation Service Application Controls-Program Contracts System (ProTracts). Report No. 10501-5-FM. (Washington, D.C.: July 2006); GAO, Conservation Security Program: Despite Cost Controls, Improved USDA Management Is Needed to Ensure Proper Payments and Reduce Duplication with Other Programs, GAO-06-312 (Washington, D.C.: Apr. 28, 2006); Audit Report. Natural Resources Conservation Service. Environmental Quality Incentives Program. Report No. 10099-18-KC. (Washington, D.C.: February 2005); and Audit Report. Natural Resources Conservation Service. Environmental Quality Incentives Program. Cost Share Practice Approvals and Specifications in Nebraska. Report No. 10005-1-KC. (Mission, Kans.: November 2002). [27] We used both the variance inflation factor (VIF), as well as inspection of the eigenvalues to determine the extent of multicollinearity in the model. Many of the eigenvalues were close to zero, indicating a serious problem with multicollinearity. [28] Fekedulegn, B. Desta, J.J. Colbert, R.R. Hicks, Jr., and Michael E. Schuckers, "Coping with Multicollinearity: An Example on Application of Principal Components Regression in Dendroecology," Forest Service, Northeastern Research Station, Research Paper NE-721, USDA, 2002; Norton, D.A., "Tree Growth--Climate Relationships in Subalpine Nothofagus Forests, South Island, New Zealand," New Zealand Journal of Botany, 1984, vol. 22: 471-481. [29] In order to perform the principal components analysis, we used the SAS PRINCOMP procedure. [30] The vectors are said to be uncorrelated or orthogonal (perpendicular) to each other when they yield a zero valued scalar product. [31] Guiot, J., Berger, A.L., Munaut, A.V., 1982. "Response Functions," In: Hughes, M.K., Kelly, P.M., Pilcher, J.R., LaMarche, V.C., eds. Climate from Tree Rings. Cambridge, UK: Cambridge University Press: 38- 45. [32] V is a (j x j) matrix of "orthonormal" eigenvectors, meaning that it has the property that its transpose and its inverse matrix are equal. Equivalently, any pair from the set of column vectors, or row vectors, of the matrix are perpendicular or orthogonal (have a scalar product of zero), while any individual vector from the set has a norm of one (scalar product with itself of one). [33] An eigenvector of a transformation is a vector whose direction is unchanged by that transformation. The factor by which the magnitude is scaled is called the eigenvalues of that vector. [34] The stepwise regression procedure examines the impact of each variable to the model on a step-by-step basis. A variable that cannot contribute much to the variance explained is eliminated. [35] To test for the statistical significance of the principal components estimators, it has been shown that the proper test statistic to use is a t-test with (n - k - 1) degrees of freedom. Therefore, for a two-sided test: H0 : bjS = 0 vs. Ha : bjS¼0, with significance level a, the null hypothesis, H0 , should be rejected if the test statistic is greater than or equal to the critical value, (t a/2, n-k-1 ). The actual test statistic, where bSj,pc is the standardized principal component estimator of bjS is t = bSj,pc / s.e.(bSj,pc ) where s.e.(bj,pc ) is the standard error of the coefficients of original environmental factors. It is estimated by dividing the standard error of the standardized principal component estimator, bSj,pc, by the standard deviation of the corresponding environmental factor. Mansfield et al. (1977) and Gunst and Mason (1980). [36] As in the regression analysis, we do not include the carbon sequestration variable or the pesticide and nitrogen runoff variable as these are linear combinations of other data in the allocation formula. Also, this analysis does not include an adjustment made in the data for the factor "acres of American Indian Tribal Lands" between two states. We do not expect that this adjustment would have a material affect on the results. [37] Specifically, factor analysis was used in a study to identify and interpret soil quality factors at a regional level. Brejda, John J. and Thomas B. Moorman, "Identification and Interpretation of Regional Soil Quality Factors for the Central High Plains of the Midwestern USA," In: D.E. Stott, R.H. Mohtar, and G.C. Steinhardt (eds.), Sustaining the Global Farm, selected papers from the 10TH International Soil Conservation Organization Meeting held May 24-29, 1999, Purdue University and USDA-ARS National Soil Erosion Research Laboratory. [38] A "scree test" is a graphic method for determining the number of factors. The eigenvalues are plotted in the sequence of the principal factors. The number of factors is chosen where the plot levels off to a linear decreasing pattern. [39] In this case, we applied an orthogonal rotation to the initial factor pattern matrix. [40] In factor analysis terminology, a "loading" is the correlation between a variable and a factor. A correlation above 0.40 is considered a statistically significant correlation. 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