agriculture and ecological services: recommendations for ... · • payment for ecological services...

Agriculture and Ecological Services:

Recommendations for Support Programming in British

Columbia

Final Report

January 31, 2015

Prepared for the BC Agricultural Research & Development Corporation

by:

George W. Powell, PhD, PAg

Innovative Natural Resource Management Solutions

Ag For Insight.com

Agriculture and Ecological Services - Final Report v 1.1

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Acknowledgments

This review benefited from the voluntary contributions of many individuals and organizations who gave their

time and shared their expertise to complete an opinion survey or participate in telephone interviews, group

consultations or a regional focus group. Your input and assistance with this review is gratefully

acknowledged.

Funding for this review was provided by the Agriculture Environment Initiative and Growing Forward 2, a

federal-provincial-territorial initiative.

Disclaimer

Information in this report was obtained, in part, from unpublished, third-party sources. The author has relied

in good faith on this information in developing the analysis and recommendations contained in the report.

Opinions expressed in this document are those of the author and not necessarily those of Agriculture and

Agri-Food Canada, the BC Ministry of Agriculture, the BC Agricultural Research & Development

Corporation or the Investment Agriculture Foundation of BC. The Government of Canada, the BC Ministry

of Agriculture, the BC Agricultural Research & Development Corporation and the Investment Agriculture

Foundation of BC and their directors, agents, employees, or contractors will not be liable for any claims,

damages, or losses of any kind whatsoever arising out of the use of, or reliance upon, this information.

Project funding provided by:


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Summary

A strategic review was conducted of the current activity and needs for additional support addressing the stewardship of ecological goods and services (EGS) on agricultural lands in British Columbia. An analysis and recommended actions for the Ecological Services Initiative (ESI) to contribute to strengthening support for EGS stewardship are provided.

The review was conducted in five phases:

1. A synthesis of key agri-environmental information was completed;

2. Stakeholder consultations were used to help define and rank priority issues;

3. A strengths, weaknesses, opportunities and threats (SWOT) analysis was completed;

4. A program gap analysis was completed; and,

5. Recommendations were created for program development, partnerships and outreach.

The general conclusions of the information synthesis were as follows:

Agriculture and Ecological Goods and Services • Both agricultural production and other ecological goods and services (EGS) are very important to

society.

• Agriculture and the environment are inseparably linked.

• Agri-environmental relationships are complex and difficult to fully quantify.

Payment and Rewards for Ecological Services

• Agricultural activity creates and maintains EGS for society, but payment for EGS is not universal and

is complicated by confusion over economic value and intrinsic value.

• Payment for ecological services (PES) needs to be viewed in the context of other options to achieve

stewardship goals.

• PES must link a willingness to provide (supply) and willingness to pay (demand) for EGS.

• Auctions and trading schemes are the most economically efficient program delivery methods.

• Elements common to successful PES programs include focusing on solving an existing agri-

environmental issues, setting measurable goals, securing funding and working collaboratively.

Ecological Services in the BC Context

• BC agricultural production and agri-environmental issues are highly regionalized. • The highest priority issues relate to soil and water, wildlife habitat and species at risk. • Many fundamental questions about agricultural land use in relation to EGS need to be answered to

inform the development of PES programs in BC.

Public and Stakeholder Support in BC

• The perceived need for PES programs is not being driven by public sentiment. • There is no stakeholder consensus on the appropriate mix of using regulation, compensation and

other incentives to facilitate positive agri-environmental outcomes. • Stakeholders do not want new programs established if it means cuts to existing support, and many

note the need for better coordination between different programs.


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• Many producers are opposed to preservation (removing land permanently from agricultural production) in favour of conservation (employing sustainable management) to achieve environmental goals.

• Viable PES funding options in BC are very limited.

BC Agri-Environmental Programs

• Successful agri-environmental support programs are established in BC, including a long-running regional PES program in Delta.

Ecological Services Initiative

• ESI activity has focused on building partnerships, creating awareness, demonstration and distributing

an arbitrary payment to participating producers.

• Literature reviews and limited technical and economic support tools have been created.

• The ESI believes it has a PES model that is ready for a wider application to fulfill its vision of "...a

sustainable paid ecosystem services program that supports ecological integrity and food security in

Canada."

The ESI's strengths, weakness, opportunities and threats can be summarized as the following:

Strengths

1. Linkages thematically to other initiatives;

2. Collaborative approach;

3. Elevated awareness of PES issues in BC;

4. Established partnerships; and,

5. Willingness to adapt.

Weaknesses

1. Unrealistic vision directed towards developing a PES model for Canada;

2. Lack of a well-documented rationale, tied to strong, incremental needs for this type of program in

BC, restricting the ability to secure funding, or to engage stakeholder and public support;

3. Communications are weak about the program goals, activities and outcomes;

4. Insufficient focus on solving a critical local or regional agri-environmental issues;

5. Limited beneficial outcomes from demonstrations and pilot project work;

6. Limited utility of ecological and economic protocol development work;

7. Important baseline information is lacking to justify the widespread use of PES support in BC;

8. Limited program linkages for new PES support to work incrementally with other initiatives and

support programs;

9. Limited linkages to regional or sub-regional planning;

10. Limited involvement outside of private land agricultural stakeholders;

11. Lack of organizational capacity to carry out development work; and,

12. No viable funding options for program delivery have been established.


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Opportunities

1. Learn from established agri-environmental support programs in BC (e.g. DFWT, EFP Program, BMP

Program);

2. Links to agricultural planning can be established (Group EFP process or Agricultural Area Plans to

address watershed-level and regional issues);

3. Development funding is available;

4. Expertise is accessible to carry out development activities; and,

5. Public engagement can be used to improve backing for EGS support programs.

Threats

1. No viable delivery funding is available;

2. Not enough compensation funds available to meaningfully address all of the stewardship needs on

agricultural lands;

3. No public policy framework in place;

4. No comprehensive land use planning framework to address agri-environmental issues;

5. PES options may alienate some stakeholders;

6. Provincial food security could decrease if compensation is primarily directed to removing agricultural

land from production;

7. Key land use information may not be developed; and,

8. Development partnerships may not be created around common goals.

The ESI has a multitude of program gaps that preclude a provincial or multi-regional delivery program and

restrict its ability to support program development. These include:

• Unrealistic program vision and goals that need to be redefined in terms of viable program

outcomes;

• Existing strategic and communications plans need revision and substantial expansion;

• Detailed operational plans must be developed for each pilot project;

• Regional development partnerships need to be strengthened around a common vision and realistic

goals;

• Program staffing, finance, strategic, communications and technical roles are not defined.

Distribution of authority is not formally defined and decisions are not well documented;

• ESI does not have internal audit or compliance provisions;

• ESI has no internal capacity to manage financial and human resources support, compliance with

regulatory requirements or audit procedures;

• Most of the operational technical procedures need to be developed, formally adopted or refined;

• ESI has no internal capacity to manage or deliver technical support;

• Data sharing provisions need significant improvements.

• Program reporting procedures need substantial improvement.

• Significant delivery gaps exist for education, extension of technical information and outreach

activities to the broad base of agricultural stakeholders.


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Recommendations

In view of the its strengths and weaknesses, the following recommendations are provided to help the ESI

realize opportunities and avoid program threats:

1. Support resources should be focused on fulfilling a four to five year development cycle with the goal

of creating compelling cases for regional PES delivery programs. A provincial or multi-regional delivery

program is not feasible and not recommended for the near to mid-term.

2. Development and delivery of payment for ecological services support programs should adopt and

follow a set of guiding principles reflecting the strengths and opportunities for EGS support in BC and

reflecting the diversity of stakeholder values and priorities:

• Local;

• Producer - led;

• Collaborative;

• Merit-based;

• Incremental;

• Accessible;

• Voluntary;

• Science-based;

• Efficient;

• Transparent; and,

• Practical.

3. The ESI should fulfill a vision of facilitating and supporting the creation of sustainable local and regional PES programs established to address their issues and needs.

4. New and existing ESI pilot projects should set issue-specific strategic goals, and should validate their

projects with a formal needs assessments.

5. Reorganize the ESI to a council structure for decision making supporting local and regional pilot

projects with paid administrative, project development and communications support:

• Agricultural Ecosystem Services Development Council for decision making;

• Facilitator, directed by Council and providing project development and communications support

to the local and regional initiatives;

• Administrator, directed by Council and providing administrative support to the local and regional

initiatives and Council; and,

• Ex-officio advisors to Council.


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6. Revise and expand the ESI communications strategy to improve awareness, education, information

exchange and stakeholder outreach outcomes. Individual strategies should be developed for:

• Internal communications and reporting; and,

• Pilot project and demonstration project communications;

• Public awareness and stakeholder outreach; and,

• Agricultural producer education.

Communications delivery should be carried out by the ESI Facilitator, except producer education which

should be delivered through other support programs.

7. Conduct social, economic and BMP research, primarily by synthesizing pertinent information and

retrospective analyses of existing programs and activities in BC.

The priority research topics to be addressed by this work are as follows:

• Social research to assess BMP adoption rates;

• Retention levels of BMPs;

• Identification of real production costs and benefits;

• Trial exploration of the effectiveness and cost-efficiency of distributing BMP support; and,

• Survey work to document educational outcomes.

8. Support the creation, updating or expansion of geographic data sets and tools related to key EGS

inventories and agricultural land use, condition and trends.

9. Work collaboratively with outside research and development programs to develop and refine BMPs

that create co-benefits for agricultural and conservation goals (e.g. agroforestry systems).

10. Engage potential delivery funders in the development process.

11. Explore alternative means to fund EGS support activities on agricultural lands through existing

programs and initiatives.

12. Build and maintain meaningful partnerships and linkages to third-party resources, protocols and

information networks for program development.


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Contents

1. Purpose ...................................................................................................................................... 1

2. Goals ......................................................................................................................................... 1

3. Review Process

3.1 Review Framework ............................................................................................................. 2

3.2 Consultations ...................................................................................................................... 4

4. Information Synthesis

4.1 Agriculture and Ecological Goods and Services ................................................................... 6

4.2 Payment and Rewards for Ecological Services ..................................................................... 9

4.2.1 Economic Considerations for PES Schemes ............................................................... 13

4.2.2 Common Elements of Successful PES Programs ........................................................ 16

4.3 Ecological Services in the BC Context .............................................................................. 17

4.3.1 Soil Quality ............................................................................................................... 20

4.3.2 Riparian Areas and Wetlands ..................................................................................... 21

4.3.3 Water ........................................................................................................................ 23

4.3.4 Wildlife Habitat and Species at Risk .......................................................................... 25

4.4 Public and Stakeholder Support in BC

4.4.1 Public Sentiment ....................................................................................................... 28

4.4.2 Stakeholder Opinion .................................................................................................. 28

4.4.3 Conservation, Preservation and Food Security ........................................................... 31

4.4.4 Funding Options for BC PES Programs ..................................................................... 32

4.5 BC Agri-Environmental Programs

4.5.1 Delta Farmland and Wildlife Trust ............................................................................. 36

4.5.2 Environmental Farm Plan Program ............................................................................ 36

4.5.3 Beneficial Management Practices Program ................................................................ 37

4.5.4 Farm Riparian Interface Stewardship Program ........................................................... 37

4.5.5 Salmon-Safe BC ........................................................................................................ 37

4.5.6 Stewardship Centre for BC ........................................................................................ 37

4.5.7 BC Agriculture and Agri-food Climate Action Initiative ............................................ 38

4.5.8 Government Agricultural Programs and Support ........................................................ 38

4.5.9 Other Government Programs and Support .................................................................. 38

4.6 Ecological Services Initiative ............................................................................................ 40

5. Ecological Services Initiative SWOT and Gap Analyses

5.1 SWOT Analysis ................................................................................................................ 45

5.2 ESI Program Gap Analysis ................................................................................................ 51


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6. Recommendations

6.1 Development Focus ........................................................................................................... 53

6.2 Program Leadership and Organization

6.2.1 Guiding Principles ..................................................................................................... 55

6.2.2 Vision and Strategic Focus ........................................................................................ 56

6.2.3 ESI Organizational Structure .................................................................................... 60

6.3 Stakeholder Engagement and Communications.................................................................. 64

6.4 Development Priorities ...................................................................................................... 67

6.4.1 Learn from Existing Programs ................................................................................... 67

6.4.2 Expand Geographic Information ................................................................................ 68

6.4.3 Innovative BMP Development ................................................................................... 69

6.5 Build the Foundations for Delivery Funding ...................................................................... 70

6.6 Improving Program Linkages ............................................................................................ 71

6.7 ESI Path to Success ........................................................................................................... 72

7. Information Cited ..................................................................................................................... 74

Appendices

1. Acronyms and Abbreviations .............................................................................................. 78

2. Opinion Survey Results ....................................................................................................... 80

Tables

1. PES funding options ................................................................................................................. 13

2. Summary of arguments for and against regulation, compensation or other incentives ............... 29

3. Summary of PES delivery funding options in BC ..................................................................... 34

4. SWOT summary ...................................................................................................................... 50

5. Organization resource requirement estimates ............................................................................ 62

6. Communication resource requirement estimates ....................................................................... 66


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Figures

1. Ecological services review framework ........................................................................................ 3

2. Ecological services and disservices to, and from, agriculture ...................................................... 7

3. Agricultural land as a proportion of total land area, select jurisdictions ..................................... 18

4. Private agricultural land as a proportion of total regional land area ........................................... 19

5. Proportion of riparian habitat on private agricultural lands relative to all land, within select Regional Districts ............................................................................................... 21

6. Proportion of wetland areas on private agricultural lands relative to all land, within select Regional Districts .............................................................................................. 22

7. Nutrient loading from agricultural livestock operations in the major drainages of BC .............. 24

8. Proportion of species at risk counts on private agricultural land relative to all land, by region................................................................................................................................. 26

9. Proportion of high priority species (as listed by the BC Conservation Data Centre) counts on private agricultural land relative to all land, by region ............................................. 27

10. Decision path for determining the incremental need for PES support ...................................... 57 11. Proposed ESI organizational structure .................................................................................... 60

A1. Opinion survey results to the question: "Which region(s) do you operate in?" ........................ 80

A2. Opinion survey results to the question: "What best describes your primary affiliation?" ......... 80

A3. Opinion survey results to the question: "Please indicate your level of awareness knowledge for each of the following" ................................................................................... 81

A4. Opinion survey results to the question: " Please indicate your level of involvement to date with the Ecological Services Initiative" ......................................................................... 81

A5. Opinion survey results to the question: "Please rate the importance of the following ecological goods and services from agricultural lands" .......................................................... 82

A6. Opinion survey results to the question: "Relative to your other professional /organization's priorities, how do you rate supporting stewardship of agricultural lands?" ............................. 82

A7. Opinion survey results to the question: "Please rate the degree to which you believe the following could positively influence the stewardship of agricultural lands in BC" ................. 83

A8. Opinion survey results to the question: "Relative to other agricultural or environmental support needs, how do you rate the need for an ecological services support program in BC?" ................................................................................................................................ 83

A9. Opinion survey results to the question: "Please rate the importance of the following as a means to support the provisioning of ecological goods and services from agricultural lands" ................................................................................................................ 84

A10. Opinion survey results to the question: "What do you believe are the best long-term funding options for ecological services support program delivery?" ...................................... 84


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1. Purpose

This document provides a summary of the current activity and needs for additional support

addressing the stewardship of ecological goods and services (EGS) 1 from agricultural lands in

British Columbia (BC). It provides an analysis and recommended actions for the Ecological

Services Initiative (ESI) to contribute to strengthening support for EGS stewardship through new

payment for ecological services (PES) programming.

2. Goals

This review was initiated by the British Columbia Agricultural Research & Development

Corporation (ARDCorp) in response to increasing requests for support and partnership on PES

and EGS related initiatives. These requests originate, in part, from the growing interest in

collaborative conservation work, as exemplified in the positive outcomes from the Forums on

Agriculture and Environment (Bomke 2013, Koch 2014), and the elevated profile of agri-

environmental issues in BC.

The goals of this strategic review are as follows:

1. Synthesize information on agri-environmental issues, EGS and PES relevant to the

situation in BC;

2. Understand the goals, aspirations, structure, activities and outcomes of the ESI;

3. Garner input from current and potential stakeholders and partners on support needs and

the role of other programs;

4. Assess the ESI's strengths, weakness, opportunities and threats;

5. Examine the ESI's structure and operations for gaps in critical resources; and,

6. Provide development recommendations in the broader context of all agri-environmental

support needs.

The recommendations outline a 'path to success' for PES programming in BC and identify the key

resources that are needed to move forward towards a successful outcome.

1 A list of all acronyms and abbreviations used is provided on page 78.


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3. Review Process

The strategic review was conducted in five phases, as follows:

1. A synthesis of information from key agri-environmental documentation and publications

was completed;

2. Stakeholder consultations, including interviews and small group meetings, an opinion

survey and three regional focus groups, were used to help define and rank priority issues;

3. A strengths, weaknesses, opportunities and threats (SWOT) analysis was completed;

4. A program gap analysis was completed; and,

5. Recommendations were created for program development, partnerships and engagement

with stakeholders and the general public.

3.1 Review Framework

The review process was structured using a multi-tiered approach to the issues and information.

The tiers in Figure 1 represent the 'foundations' believed necessary for successful EGS support

programming. Just as structural foundation works, each tier that is added relies on a solid base

below it for the long-term success of the whole.

The base tier involves firmly establishing the need for EGS and PES programs in BC, in the

context of relative importance of the agri-environmental issues that they can address, the influence

of other land uses on these issues, and the range of other support, planned or available.

Once the need is firmly established, the next tier involves finding the right mix of support options

that can encourage positive, and discourage or mitigate, negative externalities2, for issues that can

be meaningfully influenced by agricultural practices. For any type of payment system to work it

must link those that are willing to provide an EGS (the 'suppliers') with a group or groups that are

willing to pay for, or support the stewardship (the 'buyers').

In the third tier, with a focus on what specific types of EGS will be supported by payment or

reward schemes, a technical framework must be established that sets out the valuation parameters

(be they arbitrary, qualitative or quantitative) and the specific measurement and monitoring

protocols needed to assure both buyer and supplier.

The top tier sets out the necessary organizational details to support program development and

delivery. This top level includes securing sustainable funding mechanisms, clearly outlines the

type of administrative support needed, maintaining reasonable transaction costs for program

delivery, and sets out the audit and compliance standards. All the organizational options were

viewed with respect to their level of transparency, and the level of assurance they can provide to

all stakeholders that the programming is efficient, responsive and equitable. Moreover, all of the

development activities in support of setting an appropriate reward system, technical and

2 Externalities are the by-products or consequences of agricultural activity that affect other parties without being reflected in the cost of the agricultural goods or services.


3

organizational frameworks were examined in view of potential partnerships for development and

delivery, and other programs working towards complementary goals.

Figure 1. Ecological services review framework


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3.2 Consultations

With the complex, interdisciplinary nature of EGS issues in BC comes the need to understand the

range of regional and sector-related issues across industry, conservation, government and

community interests. Stakeholder engagement began at the outset of this review process and was

used to both inform the range of development needs and to refine and prioritize the issues.

Survey

Based on information gathered in a preliminary literature review, an opinion survey was

developed to assess:

1. The overall importance of EGS issues relative to other stakeholder issues;

2. Awareness of the ESI goals and outcomes to date;

3. Level of involvement in the work of the ESI or complementary activities; and,

4. Opinion on development and delivery options for support programs.

The full set of survey questions and results are presented in Appendix 2. The invitation to

participate in the survey was sent to 180 stakeholders (groups or individuals known to be already

somewhat informed of agricultural or conservation issues in the Province), including:

• Agricultural producers and producer association representatives;

• Federal and Provincial government employees in agriculture, environment and other

natural resource related agencies;

• First Nations and local government representatives;

• Non-governmental organizations (NGO) focused on conservation or land use programs;

• Consultants and private sector service providers; and,

• Academics and others affiliated with universities.

Some organizations chose to redistribute the survey internally for a total estimated distribution to

250 individuals. The target response rate was 50, and 110 completed the majority or all of the

survey. Of those that responded to the survey, 32 also provided written comments.

Interviews

The opinion survey was supplemented with 35 telephone and in-person interviews with

individuals or small groups of key stakeholders. The interviewees included representation from

all of target groups outlined in the opinion survey distribution, with an emphasis on individuals

with experience or a working knowledge of EGS programs and agri-environmental issues in BC.

Focus Groups

The results of the stakeholder interviews and opinion survey were used to formulate a discussion

paper (please see document titled "Agriculture and Ecological Services: Options for Support

Programming in British Columbia, For Discussion", accompanying this strategic review). The

discussion paper outlined twelve questions representing unresolved development and delivery

issues that had been identified to that point. Each focus group brought together a small group (10


5

to 14) of individuals representing a cross-section of agriculture, conservation, government,

community and other land use interests. The focus groups were intended to provide context and

clarity to the issues raised in the discussion document. The focus groups were held at the

following locations and dates:

1. Invermere, January 12, 2015;

2. Kelowna, January 14, 2015; and,

3. Abbotsford, January 16, 2015.

In addition to the focus groups, the discussion document was circulated for additional feedback to

other stakeholder groups and individuals on the opinion survey distribution list. Three individuals

provided written comments in response to that invitation, and two organizations provided

feedback through group teleconferencing.

All of the written and verbal feedback received was compiled and categorized by the major issues

or development needs identified. The recommendations in this strategic review reflect these

issues, and significant minority opinions are noted throughout.


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4. Information Synthesis

4.1 Agriculture and Ecological Goods and Services

In simple terms, EGS (sometimes also referred to as 'ecosystem services' or 'environmental

services') can be viewed as the benefits that humanity obtains from nature and natural processes.

These include many that are produced or maintained on agricultural lands and through agricultural

activities (Fig. 2). These natural outputs and processes can be grouped into four general types

(Costanza et al. 1997; MEA 2005):

1. Things that are provided (e.g. water, food, fuels, medicines, fibres);

2. Processes regulated (e.g. climate, flooding, disease, water and air purification);

3. Processes supported (e.g. nutrient cycling, soil creation, pollination); and,

4. Cultural elements (e.g. aesthetics, spiritual enrichment, educational and recreational values).

The links between human well-being and ecosystem health have been reinforced by the increasing

academic understanding of these connections (Alcamo and Bennett 2003; Constanza et al. 1997;

Zhang et al. 2007). Indeed, the flow of EGS provides the basic materials for life, and supports the

security, health and social relations needed for human well-being (MEA 2005). And, if nature is

viewed in economic terms, then EGS can be seen to include processes that allow society to:

1. Avoid costs that may manifest in their absence (e.g. properly functioning watersheds slow

water flows and store water, reducing downstream flood damages);

2. Reduce costs where services in the built environment are more costly than the natural

function they replace (e.g. wetland restoration costs may be lower than the costs of building a

water treatment facility to purify drinking water); or,

3. Maintain irreplaceable goods or services (e.g. habitat for an endangered species).

Agricultural production and other EGS are both very important to society. And agriculture both

benefits from, and produces or supports, EGS. But this should also be viewed in the context of the

ecological disservices (EDS) created or received by agriculture (Zhang et al. 2007). Disservices

include natural processes that negatively impact society. For agriculture these include things that

reduce productivity or increase costs (e.g. flooding of cropland, wildlife vectors for diseases, crop

damage by wild herbivores, livestock losses to predators).

Spatial scale has an important influence in how we assess EGS and EDS. What can be viewed as a

disservice at a farm site or locally, might be seen as a service regionally or globally. For example, a

beaver dam impounding water over a farmer's field is a disservice to local agricultural production, but

viewed in the context of a watershed, or across a region, there are potential net benefits from the

aquatic and riparian habitats created, the storage and slow release of water, and other ecological

services the dam will provide.


7

Figure 2. Ecological services and disservices to, and from, agriculture (after Zhang et al. 2007)

In viewing these relationships, it is important to understand that agriculture and the environment are

inseparably linked. Regardless of the type of production, when we produce food or other agri-

products, then some level of change also occurs in natural systems. Some changes can be viewed as

positive, some negative and many more as neutral or benign. The magnitude of change depends on

the specific agricultural production, environmental setting, surrounding species and habitats, and the

types of management practices employed. The results can therefore range from:

1. Displacement to varying degrees of local natural habitats (e.g. greenhouses, barns and other

built components of farming);

2. Systems that mimic or complement natural processes (e.g. rotational livestock grazing on

pastures or rangeland); or,

3. Enhancement of habitats or natural processes (e.g. grain fields with shelterbelts can provide

better foraging habitat for wild ungulates than the native vegetation it replaces).

These relationships are complex and sometimes difficult to isolate. And the degree of habitat

alteration at the site level does not necessarily imply one type of agricultural production is better or

more sustainable than another. Indeed, it can be argued in the BC context, that highly productive,

intensive agriculture allows society to produce food and other agri-products on a much smaller

geographic 'footprint' than extensive agriculture. This allows for more land to be set aside in protected

areas and achieve stewardship goals at the regional and provincial levels.


8

Management practices can also create positive or negative feedbacks to agriculture (Fig. 2). That is,

the specific service or disservice created through agriculture, alters, or impacts the provision or

regulation of other EGS. For example, poor soil management can accelerate soil loss, leaving a site

with diminished soil fertility and thus decreased agricultural productivity. Conversely, domestic

honey bees pollinate crops and wild plants alike. The improved survival and reproduction of diverse

native flora aided by the honey bees, attracts and retains native pollinators that, in-turn, can benefit

crop production.

General Conclusions 4.1

� Agricultural production and other EGS are both very important to society.

� Agriculture and the environment are inseparably linked.

� Agri-environmental relationships are complex and difficult to fully quantify.


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4.2 Payment and Rewards for Ecological Services

Indisputably, EGS are important to humanity. A large but still unresolved question is however,

whether that importance readily translates to an economic value (Heal 1999). The resolution to that

question can be complex, because economics does not directly deal with intrinsic values, but rather the

price of goods and services. Prices reflect the supply and demand for something, whereas values also

reflect personal philosophies and social norms.

Some stewardship benefits are directly reflected in the financial costs and benefits of agricultural

production. For example, field crop production is directly linked to soil structure and fertility, and

maintaining soil quality through adopting beneficial management practices (BMP) can lower costs

(e.g. by reducing the need for supplemental fertilizers, or by lowering the need for irrigation through

better water holding capacity) and / or can boost output, and vice versa. Agricultural production also

creates positive and negative externalities for society, because our current agri-food pricing largely

does not reflect the full social or environmental costs and benefits of EGS.

Negative externalities (e.g. water pollution) can be discouraged through environmental regulations. In

the BC context however, not all disservices created by agriculture are subject to regulation, and some

have questioned the effectiveness of the enforcement mechanisms for environmental laws (e.g. OCCP

& SOSCP 2014). There are however, educational and technical supports provided through

government, agricultural associations and other non-governmental organizations (NGO) to aid

producers in meeting their legal obligations. And existing programs aid producers in selecting and

implementing BMPs that minimize or mitigate negative externalities. Positive externalities from

agriculture (e.g. provision of wildlife habitat) however, are not as widely recognized or rewarded.

Society enjoys, but does not necessarily pay for the all EGS benefits provided by agriculture.

In the global context of increasing environmental degradation and increasing material demands from

an expanding population, there has been interest and activity in supporting the production and

maintenance of EGS on agricultural lands (MEA 2005). Starting with discussions at the 1992 United

Nations Conference on Environment and Development (a.k.a. the 'Rio Summit' or the 'Earth Summit';

Royer and Gouin 2007), but rooted in much earlier regional and national soil conservation programs,

the concept of PES has gained popularity as option to support conservation on agricultural lands. PES

are voluntary transactions where an environmental service (or a land use supporting that service) is

bought (by a government, NGO or any other private interest) from a land owner (Swallow et al.

2007). The interest in PES schemes is, in part, because over 38% of the planet's land mass is used for

agriculture (Statistics Canada 2014) and public lands alone may not be sufficient to address society's

needs for EGS into the future (Farber et al. 2006).

In the broadest definition, the 'payment' in a PES scheme can be viewed as inclusive of any reward

system designed to provide or maintain EGS, and may include (after Swallow et al. 2007):

• Direct payments: cost-share funding to implement or maintain BMPs, compensation to offset

opportunity costs from production lost to conservation or preservation, or other financial


10

incentives to change production practices (e.g. rental payments for cropland kept in permanent

vegetation cover);

• Tax incentives: reducing or removing tax obligations (e.g. eliminating property taxes on

conservation zones or reducing a capital gains tax for land donated to create reserves);

• Policy incentives: relaxation or exemption from standard government policies (e.g. increased

flexibility in how land may be used) or access to other support programs in exchange for

achieving agri-environmental criteria (a.k.a. 'cross compliance');

• Awards and public recognition: from community groups, NGOs and producer associations.

These rely on producers seeing value in the social status that this type of recognition brings;

• Market-based rewards: labeling/certification to identify products meeting stewardship

standards allowing agricultural producers to differentiate their products in the marketplace and/or

gain a price premium; sale of environmental credits or 'cap and trade' schemes; and,

• Environmental offset payments: environmental impacts at one location are offset by mandatory

or voluntary investments in environmental conservation at another.

In all cases, PES and reward instruments must link EGS demand (a willingness by someone to pay for

them) with its supply (a willingness by someone to provide them). Payments can be used as an

inducement, or for full or partial compensation, and may be either one-time or ongoing.

In general, the payments can be based on:

• Implementing BMPs that elevate stewardship beyond regulatory requirements;

• Total area under production or the number of livestock;

• Land retirement from production;

• Investment in fixed assets (i.e. on- or off-farm infrastructure);

• Technical assistance provided (free or subsidized training and other extension activities).

PES schemes can also be based on outcomes or be process driven. That is, payments can be based on

a measured outcome or condition, or can be based on the actions that are undertaken. Additionally,

payments can be based on a single good or service (e.g. the mass of carbon sequestered) or for

bundled services (e.g. payment for maintaining riparian buffers as a proxy for a variety water-related

services, wildlife habitat, soil conservation and carbon sequestration).

Over the past two decades there are hundreds of examples internationally of attempts to establish PES

programs, and some longer-term programs are in place. A large number of these projects have been

tied to poverty alleviation, food security or other international development efforts (Ottaviani and

Scialabba 2011), but there are programs in developed nations with comparable social and

environmental conditions to Canada. For example, large regional PES programs exist in Australia.

By far, the largest program is in the United States of America (USA). Through the Conservation

Reserve Program (CRP) and Wetland Reserve Program, land owners can receive rental, cost-share or

incentive payments to set-aside land from agricultural production or implement other conservation

practices over set contract periods. The CRP distributes approximately $1.8 billion (USD) a year to

set aside more than 140,000 km2 of what is considered “environmentally-sensitive" farmland. Many


11

other regional PES programs exist in the USA, including the Whatcom County Conservation Reserve

Enhancement Program (CREP) in areas adjacent to BC in Washington State. CREP is a voluntary

program that pays landowners rent, a signing bonus and reimburses the costs associated with planting

riparian buffers along water bodies.

Large regional and national PES programs also exist in Europe, where annual payments can represent

up to 14% of national farm income (Royer and Gouin 2007). Although, as in with national programs

in the USA, it can be difficult to separate the intent to reward stewardship from other political

motivations to make transfer payments to rural land owners.

Regional PES programs are not new in Canada. Since 1989, at least eight different large-scale

government and NGO stewardship programs were developed to pay Prairie agricultural producers to

either remove land from production or convert annual cropland into pasture or grassland (Nykoluk

2013). All the programs listed by Nykoluk (2013) have since terminated. Currently the Alternative

Land Use Services (ALUS 2014) operates as pilot projects or limited regional programs in Alberta,

Saskatchewan, Manitoba and Ontario, and as a provincial program in Prince Edward Island (PEI).

Each ALUS program has set its own regional focus, and they employ a mix of cost-share and annual

compensation payments to establish or maintain BMPs. For example, in Alberta the ALUS operates

in three counties and provides annual per area payments for on-farm enhancement of wetlands, creeks

and marginal farmland. Ontario employs a mix of demonstration sites at several locations, and one

operational program in Norfolk County where 28 farms have active projects ranging from establishing

tree or grass cover on marginal farmland to preserving wetlands for bird habitat (ALUS 2014). PEI is

the only jurisdiction in Canada to have a provincially managed and funded PES program. It was

created in 2008 and has enrolled over 400 producers who receive annual payments of $150 to $250/ha

for activities directed at soil conservation, including removing highly-sloped land from cultivation,

planting and maintaining buffer zones or putting soil conservation structures in place. In addition to

the ALUS pilot projects that have been initiated in Saskatchewan, that province is also home to the

Ranchers Stewardship Alliance Inc. This producer-led pilot PES initiative is attempting to establish

market-based PES mechanisms for grassland conservation, and has currently enrolled three ranches.

In the majority of examples nationally and internationally, PES programs have been focused on

temporarily or permanently retiring agricultural land from production. Despite the apparent growing

interest in the concepts, policy makers and support programs have generally struggled with bringing

other types of PES schemes into practice. As concluded in reviews of EGS from agriculture and

agroforestry, relatively few examples exist of long-term, viable mechanisms that compensate

agricultural producers for the environmental services they provide (CIRAD 2011), or of arrangements

that pay to maintain the quality of environmental services (Swallow et al. 2007).

This reality stems from the significant challenges in systematically assessing ecological condition and

trends at both the farm-level and larger scales, as a necessary element in determining how EGS are

influenced by agriculture. There are also complexity in pricing EGS, and clear government policies to

guide development and implementation are lacking. Additionally, there are major information gaps

with respect to critical EGS spatial information, cost-effective monitoring methods and sustainable


12

program funding mechanisms, all of which pose significant barriers to PES adoption (CIRAD 2011,

MEA 2005; Olewiler 2007, Ottaviani and Scialabba 2011, Royer and Gouin 2007, Swallow et al.

2007).

It is also important to note that other widely used conservation options exist and can work in parallel

or as an alternative to payment systems to achieve the same goals, including (Swallow et al. 2007):

• Educational approaches: information and technical support are provided to producers to

encourage their understanding of agri-environmental issues and adoption of BMPs;

• Regulatory approaches: where governments stipulate standards, over and above those necessary

to prevent negative externalities;

• Self regulation /voluntary stewardship: binding standards adopted by producer associations or

through individually negotiated agreements, including those with wholesale buyers and food

retailers seeking 'sustainable sourcing' from their agri-product suppliers; and,

• Property rights instruments: the purchase of agricultural lands for permanent preservation, or

for conservation rights, covenants or easements.

4.2.1 Economic Considerations of PES Schemes

The ultimate viability of a PES program relies on securing a funding source (a willing payer) and

having an efficient program delivery system that minimizes the transaction costs (i.e. administration

and other overhead costs) associated with distributing payments to agricultural producers.

Funding

While a frequently noted barrier to implementing programs, as noted in other reviews, is the lack of

long-term, stable funding (CIRAD 2011, Ottaviani and Scialabba 2011, Swallow et al. 2007), there is

a minority opinion that believes shorter-term funding is suitable because it has a built in mechanism

for review and reflection for the ongoing need for the work. Internationally, the private sector is

increasingly becoming a funding source for PES schemes, however, the main funding source is

primarily from governments (Ottaviani and Scialabba 2011). Table 1 summarizes potential funding

sources for PES programs and some general challenges associated with each of these opportunities.

Market-based funding solutions are popular academically for their potential efficiency (Nolet 2008,

Vercammen 2011), but real-world examples are somewhat limited. Internationally, cap-and-trade

schemes3 primarily exist for carbon or biodiversity, with very limited deployment among other EGS.

Off-set compensation funds can be viable, but are sporadic and generally tied opportunistically to

other development activities. Agricultural producers may have difficulty in accessing either trade or

off-set programs because of the difficulty in aggregating credits for sale to a volume meaningful to the

market place.

3 A cap on emissions or a change in conditions that can be created (i.e. an aggregate maximum amount) is established and divided by permits among users of natural resources. This allows for trading of permits between those who do not need their full quota to those who exceed their allocation, and would be penalized for doing so.


13

Table 1. PES Funding Options

Opportunity Challenges

Private-based

Charitable donations or grants from regional, national and international organizations.

Conservation contracts, easements.

Business-to-business arrangements.

Limited total pool of resources available.

Local or regional interests may not align well with national or international organizations' funding priorities.

Public-based

Government expenditures.

Tax reduction or exemptions.

Indirect support (e.g. technical or education programs provided).

Must have strong public acceptability.

Need sufficient public revenues to support the program.

Requires alignment with a supportive government policy framework.

Must not conflict with other domestic laws or international treaties and trade agreements.

Must be equitable to all geographic regions and sectors (agricultural and non-agricultural).

Market-based

Certification and labeling.

Trading schemes.

Impact offsets.

Many competing certification schemes and brands exist, leading to consumer confusion.

Certification can shift from a means to gain a price premium in the market, to a new base expectation, eliminating the price premium and becoming an access to market issue.

Trading schemes require specific, and sometimes complex, legal frameworks.

Trade and off-set schemes may require supportive government intermediary (e.g. non-voluntary impact offsets).

Producers cannot package and sell all EGS in the same manner as other commodities and services.


14

Other considerations in establishing funding support include (Ottaviani and Scialabba 2011):

• Realistic Pricing: ability to objectively price individual or aggregated EGS;

• Additionality: the degree to which an incentive creates benefits incremental to those that

would have occurred in the absence of the PES support. Embedded within this is the need to

understand the level of 'free-ridership', that is, individuals or society may likely be reluctant to

pay for something that they can otherwise receive for free;

• Efficiency: maximising the difference between benefits and costs, by optimizing how PES

resources are distributed; and,

• Permanence of benefits: how long a BMP will be implemented or an EGS condition will be

maintained.

Delivery

A multitude of options exist for enrolling producers, and apportioning PES resources, each with an

associated level of efficiency via their transaction costs. In general terms, PES funding support can be

distributed to agricultural producers:

• Arbitrarily;

• On a first-come, first-served basis for all those meeting a set of minimum criteria, until

program resources are exhausted;

• By traditional or reverse auctions;

• By a merit-based application process; or,

• Through private contracts and market transactions.

If markets and market prices for the target EGS are already established, they are an obvious basis for

determining payments (Heal 1999). Arbitrary and first-come, first-served systems may have lower

administrative requirements, but don't necessarily allocate funds equitably or achieve the optimal

stewardship outcomes.

Greenhalgh et al. (2007) suggest reverse auctions are a highly efficient allocation tool where limited

financial resources for payments are available. In a reverse auction, sellers compete to supply buyers

with a specified good or service. This enables buyers to locate the most competitive sellers and

allocate funding in a way that achieves the greatest environmental outcomes for the available

resources. Existing PES programs, including regional Australian programs and the Wetland Reserve

Program in the USA, have used reverse auctions in their funding distribution.

Transaction costs are an important consideration in the efficiency of a support program. In addition to

the resources required to distribute funds to producers, there are often additional resources required for

audit and verification of the EGS outcomes or BMP implementation. The costs associated with

verification can be significant. For example, transaction costs in PES pilot projects in Manitoba were

reported to be 67% of the producer payments distributed (Nolet 2008). Similarly, an analyses of

wildlife damage and predator impact mitigation programs in BC have shown that program delivery

can cost more than twice the amount of compensation received by agricultural producers (Pacific

Analytics Inc. and Risk Reduction Strategies 2011, Zbeetnoff and McTavish 2004).


15

Nolet (2008) conducted a detailed analysis of the costs and benefits of policies that could increase the

supply of EGS from agricultural land in Canada. The range of options for support program delivery

analyzed included annual payments, one-time payments, reverse auctions, and EGS trading. Market

based and auction methods for a range of target EGS were found to be significantly less expensive to

achieve environmental outcomes than either annual or one-time payments. For example,

improvements in water quality in BC through phosphorus (P) reduction was estimated to generate

approximately $119 million in benefits resulting from increased fisheries values, recreational activity,

and reduced water treatment expenses. To achieve the target P reductions, it was estimated that $23

million in annual payments would be required or $13 million, through a one-time payment. In

contrast, the modelling suggested reverse auctions or a water quality trading system could achieve the

same level of benefits for only $6 million or $5 million, respectively. In general, across all regions of

Canada, Nolet (2008) concluded one-time or annual payments would be two to five times more

expensive than market instruments to achieve similar results. A national EGS program to improve

both wildlife habitat and water quality was estimated to generate at least $3.3 billion in benefits and

would cost between $1 billion and $2.8 billion (Nolet 2008).

4.2.2 Common Elements of Successful PES Programs

In reviews of EGS support and PES schemes (ALUS 2014, CCA 2013, CIRAD 2011, Gagnon 2005,

Gorsuch 2011, Haddock and Good 2012, Maxcy and Rubridge 2013, Ottaviani and Scialabba 2011,

Swallow et al. 2007) some common program elements emerge that generally to contribute to

successful outcomes, summarized as follows:

1. An existing agri-environmental issue creates the impetus for the program;

2. Clear, measurable goals are established at the outset of the program;

3. Beneficiaries and willing buyers (funders) are indentified early in the process;

4. Support is targeted on specific, clearly quantified EGS, that can be meaningfully impacted by

agricultural practices;

5. High degree of agricultural producer involvement in the program development;

6. Partnerships and collaboration among all agricultural and non-agricultural stakeholders;

7. Participation in program delivery is voluntary;

8. Payments are set to reward positive outcomes, not just activity;

9. Focused on issues at the local or community level, with linkages, as needed, to regional,

national or international support;

10. Simple monitoring protocols are used, validated by a more detailed, scientific basis; and,

11. Dedicated leadership, with paid support, develops and implements the program; and,

12. A formal organizational structure is created to oversee the program with transparent processes

and regular reporting.

Simplicity can also support successful outcomes. As a matter of practicality, participation by

agricultural producers in PES programs is usually higher when fewer changes are required to meet

program requirements (Gorsuch 2011). There is a danger however, in over-simplification such that

issues are not meaningfully addressed or other unintended consequences are created.


16


� Agriculture creates and maintains EGS for society, but payment for EGS is

not universal and is complicated by confusion over economic value and

intrinsic value.

� PES needs to be viewed in the context of other options to achieve

stewardship outcomes.

� PES must link a willingness to provide (supply) with a willingness to pay

(demand) for EGS.

� Auctions and trading schemes are the most economically efficient program

delivery methods.

� Elements common to successful PES programs include focusing on solving

existing agri-environmental issues, setting measurable goals, securing

funding and working collaboratively.


17

4.3 Ecological Services in the BC Context

There was a strong indication of support expressed at the Forum on Agriculture and the Environment

(Bomke 2013) and in the opinion survey results (Appendix 2, Fig. A6 and A8) for the stimulating and

maintaining the EGS stewardship on agricultural lands in BC. There was however, a notable minority

opinion expressed in the stakeholder consultations that no program support is needed to achieve

acceptable stewardship outcomes (see discussion, section 4.4).

Among those in favour of creating support mechanisms, strong agreement exists emphasizing the need

to focus EGS programming, and in particular PES schemes, on local needs and priorities. But there

have been few quantitative assessments of land use patterns in BC to validate the interest regionally or

provincially, or to set a strategic focus for support programs.

Globally, there are two foundational arguments as to why agriculture should be a strategic focus for

PES programs:

1. Agricultural production occupies a high proportion of the total land base; and,

2. Agriculture occupies areas of the landscape that are high in biodiversity and associated

ecological services, and therefore has a disproportionate effect on the provision or

maintenance of EGS.

Internationally and elsewhere in Canada, the proportion of the total land base under agricultural

production can be considerable but is also highly variable (Fig. 3). For example, where large-scale

PES programs exist in the European Union and the USA, agriculture represents approximately 50%

and 45%,respectively, of the total base. Regional programs exist in Canada and Australia, both of

which have less than 7% of their land area devoted to agriculture (Statistics Canada 2014), but focused

on regions displaying similarly high amounts of agricultural land. For example, in PEI, home of

Canada's only province-wide PES program, agricultural land occupies 42.5% of the land base

(Statistics Canada 2011). Though, it should be duly noted that PEI is also Canada's smallest province

with a total land area less than one-quarter the size of Vancouver Island.

Other national or international EGS issues and PES programs, and the motivations for their

establishment however, are not necessarily transferable to the BC situation. In particular, BC is

somewhat unique in that Crown lands make up the vast majority (95%) of land base, and on that large

public land base, government policy directs land use standards for agricultural and other activity.

Crown lands are important to agriculture in the Province, in particular to the ranching sector, with

approximately 8.7 million ha of land tenured for range use and hay cutting permits within multi-use

areas, and 1% of the Crown land in BC dedicated to farming via grazing and agricultural leases (Smith

et al. 2011). The Agricultural Land Reserve (ALR), as one measure of the land suitable for

agriculture, covers approximately 5% of the total area of BC, but only 2.6% of the provincial land

base is under active production (Statistics Canada 2011). Private agricultural land is however, more

significant as a proportion of total land use in some regions (Fig. 4), and represents approximately

57% of the private land base in the Province. The extent of agricultural activity on First Nations land

has not been summarized provincially, but is incremental to the area bound under the ALR.


18

Figure 3. Agricultural land as a proportion of total land area, select jurisdictions (various sources).


19

Figure 4. Private agricultural land as a proportion of total regional land area (Statistics

Canada 2011)


20

Within both the ALR, and the portion that is currently under active production, there are strong

indicators of a high level of retention of natural features and wildlife habitats. Mapping conducted by

the BC Ministry of Forests, Lands and Natural Resource Operations (FLNRO) identified that 60% of

ALR land appears as forests, 24% as crop land, 9% as rangeland and the remaining 7% primarily as

either freshwater, wetlands, buildings and roads (Smith et al. 2011). From the census of agriculture

(Statistics Canada 2011), producers reported that approximately 23% of the total agricultural land area

is cropped (inclusive of field crops, vegetables, fruits, sod and nursery crops) with an additional 1%

fallow annually, 53% are natural areas used for grazing, 9% tame or seeded pastures and the

remaining 14% containing a mix of woodlands, wetlands, Christmas tree plantations, roads,

greenhouses, barns other and farm buildings. It is important to note, for all the foregoing statistics,

that the area designations do not provide an indication of the condition of the land.

Agriculture's contribution to specific environmental issues however, is not likely fully reflected in the

total area or relative amounts devoted to farming and ranching. For a more refined analysis, an

examination of the overlap of important habitat features, ecological processes and species distributions

is needed, together with the relative contributions of agricultural activities and those of other land

uses. The opinion survey results (Appendix 2, Fig. A-5), stakeholder consultations and issues

identified in the Forums on Agriculture and the Environment (Bomke 2013, Koch 2014), suggest that

in addition producing food and other agri-products, wildlife, water and soil quality are among the most

important EGS related to agricultural lands in BC. With the notable exception of climate adaptation

issues, these results are in a general agreement with the broad EGS priority categories established

internationally (Ottaviani and Scialabba 2011).

In discussing EGS issues in BC it also important to note that the 'Crown' (Her Majesty, the Queen, in

right of the Province) owns much of the ecological capital in Province and regulates the use of others,

both on and off private land. For example, the ownership of water (as stated in the Water Act) and

wildlife (all native and some non-native amphibians, reptiles, birds, mammals that live in BC as

defined in the Wildlife Act) are both vested with the Crown, and can only be used by the terms set out

in those and other acts of the Legislature. The Federal government has responsibility for protection

and management of migratory birds, as well as other nationally significant wildlife habitat and

endangered species. No ownership is declared over air, although air quality in BC is managed through

regulations. Soils in BC belong to the owner in fee simple of the property and soil quality parameters

are generally not regulated, with the exception of the provisions of the Agricultural Land Commission

Act, which restricts the removal or degradation of agricultural soils within the ALR by non-

conforming uses.

4.3.1 Soil Quality

Soils are clearly important to many types of BC agricultural production, and stewardship of soil

quality is a prominent component of a long-running and successful regional PES program in BC

carried out by the Delta Farmland and Wildlife Trust (DFWT). Maintaining soil quality however, also

conveys a very strong private benefit to the agricultural producer. It can therefore, be difficult to

quantitatively separate the private and public benefits received through stewardship.


21

Presumably because of the relatively high degree of co-benefits from soil conservation, adoption of

soil-related BMPs is increasing significantly among BC agricultural operations. For example, in

2011, approximately 20% of farms reported using field windbreaks or shelterbelts (natural or planted).

The area of no-tillage cropping increased by 67 % (25,214 ha) between 2006 and 2011, and

conservation tillage increased by 39% (20,231 ha) in the same time frame (Statistics Canada 2011).

4.3.2 Riparian Areas and Wetlands

On-farm wetlands and riparian buffers help to protect or enhance water quality by filtering and

trapping sediment, nutrients and other contaminants. Based on regional land use information,

significant variability exists in the distribution of both riparian habitats and wetlands on agricultural

lands relative to the total land base (Fig. 5 and 6). It is important to note that the presence of these

habitats on agricultural land does not necessarily correlate to their ecological condition or trend in

condition (i.e. improving, stable or degrading). According to the self reporting from the Census of

Agriculture (Statistics Canada 2011), 33% of BC farms (representing 11% of total farm area) retained

woodlands and wetlands in their natural state. Moreover, 20% of BC farms had riparian buffers to

protect water bodies (Statistics Canada 2014). Feedback from the stakeholder interviews however,

indicates that there are some acute regional issues related to wetland and riparian health on

agricultural lands.

Figure 5. Proportion of riparian habitat on private agricultural lands relative to the area

of riparian habitat on all land, within select Regional Districts. The size of the circles

represent the total area of riparian habitat on agricultural lands in each region (Hectares

BC 2014).


22

Figure 6. Proportion of wetland area on private agricultural lands relative to the area of

wetlands on all land, within select Regional Districts. The size of the circles represent

the total area of wetlands on agricultural lands in each region (Hectares BC 2014).


23

4.3.3 Water

There has been no comprehensive assessment of the potential agricultural impacts (positive or

negative) on water quality in BC. Point-source pollution can occur, and when identified, can be dealt

with by the existing regulatory framework. Non-point source incidents of water-borne pathogens have

been linked qualitatively to agricultural activities, though the limited research conducted to date has

identified variable effects linked to a wide variety of sources, both natural and human-caused (e.g.

Meays et al. 2006). Similarly, non-point source nutrient loading by agriculture, principally

phosphorus (P) and nitrogen (N) into surface and ground water has also been noted regionally. In

most instances however, although agriculture is known to be one of the contributing sources, the

impacts have not been well documented over time, or quantitatively attributed to source. Figure 7

outlines the level of agricultural nutrient loading from livestock operations in the major drainages of

BC. Three of these, the Thompson, Lower Fraser and Columbia, accounted for over 76% of the N

loading and nearly 78% of the P loading in BC. It is important to note, that this does not reflect what

portion is retained on-farm, and what potentially moves off-farm. Of BC farms that reported having

cropland in 2011, 20.1% had adopted a nutrient management plan (Statistics Canada 2014).

Stewardship practices known to protect water quality are employed by a significant proportion of BC

farms. Approximately 56% of BC farms reported pastures or grazing paddocks adjacent to surface

water in 2011, with 33% allowing unlimited year-round access to surface water, 31% unlimited access

during the grazing season, 20% imposed limited access and 14% excluded livestock access (Statistics

Canada 2014). The same census documented that 35% of farms maintained riparian buffers around

seasonal wetlands, and 45% had buffers around permanent wetlands; 48% of farms reported having

riparian buffers around all of the watercourses on their operation and an additional 13% maintained

buffers around some of the watercourse flowing through their property (Statistics Canada 2014).


24

Figure 7. Nutrient loading (t/year) from agricultural livestock operations in the major

drainages of BC (Statistics Canada 2014).


25

4.3.4 Wildlife Habitat and Species at Risk

Significant and diverse wildlife habitat is supported on agricultural lands in all regions of BC. The

overlap of agricultural land and critical habitat can also be pronounced. For example, the lower Fraser

River delta provides year-round habitat for resident birds, and is important staging and over-wintering

area for over 1.4 million migratory birds. These migratory birds and other wildlife have become

dependent on agricultural lands in the Fraser delta to provide important habitat features essential to

their survival (Merkens and Bradbeer 2013). In the south Okanagan, the remaining low-elevation

antelope brush habitat has a high degree of overlap with lands within the ALR (OCCP and SOSCP

2014). Similarly, there are nearly 1600 SAR in BC and agriculture has been identified as a

"significant threat" to their collective habitat loss (SRLGWG 2010).

Species occurrence counts suggest there is a strong presence of SAR on all agricultural lands, in all

regions (Fig. 8). A similar trend is observed in the number of high priority species, as set by the

Conservation Data Centre (Fig. 9). Species observation counts alone however, may not accurately

reflect the importance of agricultural lands to SAR. For example, some endangered species or

critically limiting habitat may strongly overlap with the occurrence of agricultural lands. Conversely,

a pilot project completed for the BC Ministry of Agriculture (AGRI) by the Institute for Species at

Risk and Habitat Studies at the University of BC Okanagan suggests agricultural lands are not always

necessarily important for providing SAR habitat because they have been significantly altered from

their natural state. Agricultural lands may however, have added importance for connecting SAR

habitat ('connectivity'), and serving as a buffer zone between natural areas and more intensive land

uses (e.g. urban or industrial developments).


26

Figure 8. Proportion of species at risk (listed in the Species at Risk Act) counts on

agricultural land relative to all land, by region (Hectares BC 2014).


27

Figure 9. Proportion of high priority species (as listed by the BC Conservation Data

Centre) counts on agricultural land relative to all land, by region (Hectares BC 2014).


� BC agricultural production and agri-environmental issues are highly

regionalized.

� The highest priority issues relate to soil and water, wildlife habitat and

species at risk.

� Many fundamental questions about agricultural land use in relation to EGS

need to be answered to inform the development of PES programs in BC.


28

4.4 Public and Stakeholder Support in BC

4.4.1 Public Sentiment

The perceived need for EGS and PES programs is not being initiated or advanced by requests

emerging from the general public, but there are indications that public support could be built for the

concept. Polling in Metro Vancouver (Robbins et al. 2009), the Fraser Valley (Cavendish-Palmer

2007) and East Kootenay (Cameron 2013) have all indicated very strong public support for

maintaining agricultural production in BC. Though when viewed by the high level of food imports

(BC farmers only produce 48% of all foods consumed in the Province and 56% of foods consumed

that can be economically grown in BC; BCMAL 2006), the level of support for resident agriculture

could be interpreted as more tepid.

There is however, a disconnection in the general public's understanding of the role of agriculture in

EGS stewardship. There is also a divergence in EGS priorities as evidenced by the difference in

results from regional public amenity polling and the opinion survey conducted for this review among

informed agricultural and conservation stakeholders. In addition to having access to local food

production, Lower Mainland residents generally rank aesthetics and recreational values of farmland

highly (Cavendish-Palmer 2007, Robbins et al. 2009). Whereas, opinion survey results indicate these

are lower priority EGS for most agricultural and conservation stakeholders (Appendix 1, Fig. A-5).

Limited regional opinion polling results suggest that when EGS concepts are explained to the general

public, they are generally supportive of efforts to reward stewardship (Cameron 2013). It remains

very unclear however, how that vocal support may translate into a willingness to pay. The same

opinion polling noted a strong level of tax-fatigue among regional rate payers. Local conservation

funds (LCF) established by referendum within two sub-regions of the East Kootenay passed by thin

majorities, and the proceeds of that sub-regional taxation are not specifically directed to conservation

on agricultural lands, nor for the delivery of a regional PES program.4

4.4.2 Stakeholder Opinion

Many options exist for supporting EGS, by rewarding positive and / or discouraging negative

externalities, and they are not mutually exclusive. Payment and reward systems are not new in BC;

regional and provincial activity already exists (see section 4.5) and the review consultations indicate

that stakeholders want to see resources allocated fairly, with a common sentiment being that new

programs should not be developed if they take resources away from existing programs. While there is

majority support in general for EGS programs, the stakeholder consultations indicate that there is no

consensus, both outside and particularly within the agricultural sector, on the appropriate approach to

balancing regulations with compensation and incentives (Appendix 2, Fig. A-7). There is a general

recognition that the existing environmental regulations are not going to be repealed, but otherwise

there was significant variation expressed in how those regulations should be balanced with new

regulations, self-regulation, voluntary measures, compensation or other incentives (Table 2).

4Stakeholder consultations and some media coverage (e.g. Schmidt 2013) revealed confusion regarding the purpose of the Columbia Valley LCF, with a common mistaken belief that it was created to support the ESI for delivery of a PES program.


29

Table 2. Summary of arguments for and against regulation, compensation and other

incentives as a means to achieve stewardship goals on agricultural lands.

A. Regulation

Agricultural producers should be subject to the 'polluter pays' principle; society should take punitive actions on those causing negative externalities and use voluntary stewardship and self-regulation for creating positive externalities.

Arguments For

• Without enforceable, minimum standards some producers will not adhere to the level of stewardship that society expects.

• Producers should not be compensated for meeting their legal and social responsibilities.

• Voluntary stewardship and self regulation create positive externalities aligned with social expectations.

Arguments Against

• Many existing regulations are not practicably enforceable.

• Regulatory frameworks are inflexible to the needs of dynamic production realities.

• Self-regulation is more 'talk' than 'action.'

B. Compensation

At a minimum producers should receive payment equal to their net conservation costs for using practices that generate public good, and be fully compensated for taking land out of production for preservation.

Arguments For

• Stewardship incurs costs that cannot realistically be captured in the price of the goods that are sold, and reserves reduce the area of privately-owned land that can generate farm income.

Arguments Against

• Many EGS cannot be objectively valued. • Recognition and non-compensation based

incentives are more realistic to employ and cost-effective than valuation and compensation.

C. Incentives

Valuing EGS is much less important than providing incentives (monetary and non-monetary) for their conservation to achieve stewardship goals.

Arguments For

• Even with the best available information, the ability to objectively price EGS for compensation, is limited.

Arguments Against

• Must give farmers meaningful financial compensation to make conservation more attractive than other land use options.


30

The diversity of opinions are founded in different production realities and existing regional and

commodity-specific management practices. And they are at least partly rooted in disagreements

regarding the level of existing voluntary stewardship, and philosophical differences related to the

perceived need or expected impact of providing incentives.

Although the opinion survey showed a strong bias against regulatory approaches (Appendix 2, Fig. A-

7 and A-9), individual interviews and focus group sessions revealed a common understanding that

some minimum standards would always be necessary, and producers should employ management to

meet their minimum legal obligations before incentives should be provided. There was also an

emphasis that there was no need to 'over-regulate' environmental stewardship and that improved

enforcement of existing regulations was required if they were to be meaningful tools for conservation.

There was a measure of concern among some agricultural stakeholders, particularly interior ranchers

and other extensive livestock operations, that PES programs should not be directed to provide

incentives for changing management, Rather, they expressed that the priority should be to recognize

and reward the public benefits and EGS that are already maintained through compatible management

practices. They argue that species and habitats exist because of current and past management

decisions, and provided examples of multiple generations of land stewardship that continues to

support important EGS. This concern reflects a belief that it is more important to reward existing

positive management outcomes and maintain those outcomes, rather than directing resources to

change management in the hope it will create positive outcomes.

Some opposition to providing financial incentives or compensation payments to producers comes

from a belief that the level of voluntary stewardship should be higher. Some producers have already

implemented BMPs at their own cost because it reflects their core beliefs and land stewardship ethics.

Some are sincerely offended by the notion that other producers need financial payment to do what

they are already doing and believe is the right thing for everyone to do.

In contrast, many noted that fair compensation payments were critical for the EDS experienced by

producers (e.g. livestock and crop losses to wildlife). Others expressed that money is a legitimate

motivator in our culture. They explained that compensation is needed because much of the

agricultural production in BC has limited profit potential, and options to use the land for other

purposes are restricted by the ALR. Many conservation measures, and all preservation actions, impart

a real financial cost which cannot be recovered in the goods and services they sell. Without a

financial incentive therefore, they believe there is no strong rationale for stewardship that does not

impart direct production benefits.

Other agricultural producers, while not opposed to receiving incentives or compensation payments,

believe a better approach to encourage stewardship on agricultural land is by maintaining a strong,

economically viable agricultural sector. They reason that if farmers and ranchers have profitable

production options they will have the resources to keep up a high level of voluntary stewardship.

They believe development resources should be directed to strengthening farming and primary

agricultural outputs, and not towards the externalities of production. A parallel argument, described

earlier in this review, suggests highly productive agriculture operations require less land to support


31

their output than low productivity, extensive systems. Having intensive agriculture on a relatively

small portion of the provincial land base, allows for the creation of protected areas elsewhere to meet

both food production and environmental goals.

Stakeholders also expressed the need for all programs be better coordinated, and that consideration

should be given to how regulations, incentives and compensation can work together. Moreover, some

identified that disservices at the watershed level (e.g. poor drainage, flooding) may negate the

effectiveness of BMPs supported at a site level (e.g. manure storage, nutrient management activities).

This suggests a need for better land use planning and coordinated action by all land managers to make

some BMP investments effective.

Threaded through many of these varying philosophical approaches to stewardship, was an underlying

fear of creating unintended consequences by whatever approach was taken. For example, by initially

paying incentives for an elevated level of voluntary stewardship, a shift in public or political

expectations around all management could be created, resulting in more stringent, inflexible

regulations being imposed, where no payments are received. Or, the need to avoid an incentive from

one program to support a specific EGS from creating an EDS to other agricultural producers.

4.4.3 Conservation, Preservation and Food Security

The terms conservation and preservation are often thought to mean the same thing. In this review

however, these two land management goals not used interchangeably. Both terms convey a

management intent to protect the environment, but differ in how that protection is achieved. The term

conservation is used to include management activities intended to sustainably produce food and other

agricultural outputs without degrading the EGS that supports that production. In other words, BMPs

are employed that allow for agricultural production within the natural regenerative and assimilative

capacity of the specific ecosystems in which they are set. In contrast, the term preservation equates

with land use decisions that remove agricultural production, in an attempt to maintain land in its

present condition and to then follow natural cycles and change without additional human influence. In

simple terms conservation can be viewed as 'proper use of nature' and preservation as 'protection of

nature from use' (NPS 2015). Conservation and preservation can be blended at the landscape level to

achieve land use goals.

In the context of this distinction, it is important to note that the stakeholder interviews and focus

groups revealed a distinct bias among agricultural interests in favour of conservation approaches and

against preservation (Appendix 2, Fig. A-9). This bias reflects a belief that, because of the relatively

small geographic scope of agriculture in BC, conservation aligns with the long-term interests of

maintaining and expanding agricultural production to meet the demands of a growing population and

export opportunities. Whereas, preservation directed onto agricultural lands is seen as reducing the

ability to produce food and other agri-products. Preservation therefore, potentially adds to the level of

food insecurity in the Province, via the high level of food imports needed to feed BC's population, and

limits the growth opportunities of the agricultural sector to produce for export.


32

The producer bias against preservation methods, contrasts with the willingness to pay by some

funding organizations In their view, charitable donations and grants are only likely viable for

development or start-up support, not program delivery, unless a high level of permanency is involved

(e.g. ceding property rights to conservation covenants or outright purchase of land).

4.4.4 Funding Options for BC PES Programs

The opinion survey identified general revenues of the Federal or Provincial governments as the top

funding option (Appendix 2, Fig. A-10), which contradicted a prevalent opinion expressed in the

stakeholder interviews, that this is not a viable option in the current policy environment. Table 3

summarizes the immediate and mid-term funding options for PES program delivery in BC.

New taxation (e.g. local levy or property tax, retail tax on foods) also received high interest. A 1%

consumer tax on food and beverage sales in BC could generate $146 million per year, and there is a

referendum mechanism in place within BC to establish parcel taxes. There has been limited research

however, to gauge the public or political acceptance of these options. The general public has recently

shown some bias against visible taxation (e.g. Harmonized Sales Tax referendum), and a substantial

public relations campaign would likely be required before new taxation gained broad public support.

Government has also been unwilling to create segregated revenues, and as such, new taxation would

likely not be able to be dedicated to agri-environmental programs without a significant public policy

shift (local parcel taxes, being a notable exception). Some types of taxation or policy support, for

example targeting retail taxation only on imported foods, would not be possible with Canada's current

international trade agreements.

A novel idea identified in the stakeholder consultations suggested tradable tax credits could be a

blended private-public means to finance PES work. Though the idea is not fully developed, it could

involve providing property tax credits or capital gains exemption credits on lands dedicated to

conservation. If the credit exceeded the agricultural producers' needs, they would have the option to

sell them to other entities.

Other private-public partnerships could also be explored (charitable donations to secure a portion of

the funding matched by government sources), as could multi-level government solutions. There is

presently no viability to fund PES programs by these means, and they would require substantial effort

to build public and political acceptability before they could be realized.

Impact offset funds can be a stable funding source (e.g. the DFWT, BC's only existing PES program

has access to offset funds originating from the expansion of Vancouver International Airport), but

once established they may only provide short-term grant support.

Grants and donations from charitable organizations are also viewed by many as a viable means to fund

PES program delivery, but the consultations revealed that many regional, provincial and national

organizations are more amenable to funding development work, not program delivery. And some

believe there will never be enough money available to address all high priority issues for a large-scale

PES program. Moreover, some international grant providers don’t rank BC issues high in the context


33

of global needs and BC's production profile doesn't align well with the agricultural commodities (e.g.

palm oil, soy, farmed shrimp) currently targeted for international conservation efforts (Jeffries 2014).

Market-based funding mechanisms are also limited in the immediate term, and would require

considerable development effort to become viable funding options. Brand recognition for certified

agricultural products is weak and the markets for environmental credits are not widely available.

There are discussions to amalgamate or coordinate various branding initiatives under a single,

recognizable label for large wholesale buyers to implement sustainable sourcing, but these are very

preliminary discussions and don't represent an immediate funding opportunity.

EGS trading schemes and options are similarly very limited. For example, of the carbon market

opportunities identified to support grassland conservation in BC (Wilson 2009), all but the Pacific

Carbon Trust (now a part of the Provincial Climate Action Secretariat) have either since disappeared

(e.g. Chicago Climate Exchange, Montreal Climate Exchange) or were never implemented (Western

Climate Initiative, Federal Offset System). The only provincial carbon credit buyer, the Pacific

Carbon Trust / Climate Action Secretariat has program parameters that are not conducive to

participation by the agricultural sector except for applying afforestation on land retired from

production. Other private arrangements can be developed through negotiation or an intermediary, but

these do not present wide-spread PES funding options at this time.


34

Table 3. Summary of PES Delivery Funding Options in BC.

Funding Source Opportunity Immediate Viability

Mid-term (5 years) Viability

Private Charitable donations or grants from regional or national organizations.

Low and very limited in scope

Moderate, but limited in scope

Charitable donations or grants from international organizations

Low Low to Moderate

Business-to-business arrangements

Low and very limited in scope

Low to Moderate, but very limited in scope

Conservation contracts, easements.



Public General revenues from Federal or Provincial governments

None Very low

Retail tax on all food and beverage sales.

None Very low

Retail tax on imported food and beverage sales.

None None

Property tax credit or exemptions incremental to existing agricultural reductions.

None Very low

Tradable tax credits. None Very low Flexible land use policy

or ALR zoning changes None None

Regional / sub-regional property tax

None Low to Moderate

Market-based

Certification and labeling

Very low and limited in scope

Low and limited in scope

Trading schemes Very low and very limited in scope

Very low to Low

Impact offsets None Low to Moderate, but unpredictable


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� The perceived need for PES programs is not being driven by public

sentiment.

� There is no stakeholder consensus on the appropriate mix of using

regulation, compensation and other incentives to facilitate positive agri-

environmental outcomes.

� Stakeholders generally do not want new programs established if it means

cuts to existing support, and many note the need for better coordination

between different programs.

� Many producers are opposed to preservation (removing land permanently

from agricultural production) in favour of conservation (employing

sustainable management) to achieve environmental goals.

� Viable PES funding options in BC are very limited.


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4.5 BC Agri-Environmental Support Programs

There is no comprehensive EGS or PES policy framework in place for BC, nor a completely unified

approach to providing stewardship support to the agriculture sector. There are however, policies that

affect the outcome of EGS support programs. There are also significant regional, provincial and

national programs, from both government and private interests, that support the stewardship of

agricultural lands and at least partially reward agricultural producers for providing EGS. A summary

of operational agriculturally-focused environmental programs is provided in the sections that follow.

4.5.1 Delta Farmland and Wildlife Trust

Initiated in 1994, the DFWT is one of the longest running agricultural PES programs in Canada.

DFWT is a NGO that promotes the co-operative stewardship of farmland and wildlife habitat on the

lower Fraser River delta.

The impetus for the program came from a growing conflict between farmers and wildlife conservation

advocates over the use of farmland by migratory waterfowl and other wildlife. The solution has

involved providing incentive payments to agricultural producers for implementing conservation

practices of high value to the resident and transitory wildlife, while also conveying a strong co-benefit

to the farmers through soil conservation.

DFWT is guided by a board of local agricultural producers and conservationists that work to:

1. Identify appropriate BMPs for soil and/or wildlife habitat conservation;

2. Provide information to farmers on the benefits and operational requirements of these practices;

3. Raise funds to cost-share the implementation of enhancing wildlife habitat on farmland; and,

4. Evaluate the programs to ensure that they are effective.

The DFWT program currently includes support for grassland set-asides, winter cover cropping, field

leveling, liming and hedgerow establishment.

4.5.2 Environmental Farm Plan Program

The Environmental Farm Plan (EFP) Program is a voluntary, confidential on-farm planning process

offered at no cost to agricultural producers in BC since 2004 (with similar programs available across

Canada). With the guidance of an EFP advisor, agricultural producers assess their environmental

strengths and risks, get a better understanding of their legal obligations and BMP options that can

improve their stewardship. An action plan is developed allowing the producer to access cost-share

funding through the BMP Program as an incentive to complete additional stewardship planning and to

implement on-farm stewardship projects. Options for group EFP are available to address regional or

watershed-level issues. Although participation in the EFP program is relatively low, with only

approximately 21% of BC farms having completed an EFP (Statistics Canada 2011), it is regarded as

an effective awareness and education resource and enjoys a high level of respect from conservation

and agricultural interests alike (Bomke 2013).


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4.5.3 Beneficial Management Practices Program

The BMP Program complements the EFP Program by providing cost-share funding for on-farm

stewardship planning and implementation. Funding is provided as an incentive to change agricultural

practices on existing farm or ranch operations where there are undesirable environmental risks, as

identified in the EFP process. In addition to the requirement of having completed or renewed an EFP

within the past 5 years and among other requirements, the stewardship projects must be located on

land designated as having 'farm status' from the BC Assessment Authority. The proportion of funding

received by eligible agricultural producers ranges from 20% to 100% based on the nature of

stewardship undertaken and the perceived public and private benefits that are expected to accrue from

the work. Some recognition of in-kind contributions may apply to the agricultural producer's share of

the project costs. Annual funding is allocated through a proposal-driven process and farms are limited

to lifetime cap of $70,000 in support and other restrictions apply.

The BMP Program funding is provided by Growing Forward 2, and is available to address a fairly

wide range of agri-environmental issues, including (as of the 2014-15 program year): manure storage,

handling, treatment and land application, farmyard and storm water management, relocation of

livestock and horticultural facilities from high risk areas, riparian area restoration and management,

erosion control structures, improved pest, irrigation and nutrient management and greenhouse gas

emission reductions. Options for pooled BMP projects are available to address large projects that

require capital investments and may require a collaborative approach.

4.5.4 Farm Riparian Interface Stewardship Program

A program of the BC Cattlemen's Association, the Farm Riparian Interface Stewardship Program

(FRISP) assists agriculture producers to protect and enhance water quality and riparian vegetation, and

prevent and mitigate agricultural impacts on streams and lakes. The program focuses on education,

awareness and building collaborative stewardship solutions through planning and conflict resolution.

FRISP focuses on identifying the co-benefits of conservation and agri-environmental stewardship, and

is seen as a model for a cooperative approach to sometimes divisive issues (Bomke 2013).

4.5.5 Salmon-Safe BC

Salmon-Safe BC is a free, independent, third-party certification program that recognizes

"environmentally friendly" management practices on agricultural lands (and urban areas) intended to

help protect salmon habitat and water quality. The program helps educate land users about the

importance of protecting ecosystems and watersheds that are essential to salmon. Salmon-Safe

originated in Oregon in 1996, and was launched in BC in 2011 by the Pacific Salmon Foundation and

Fraser Basin Council. To date, it has certified over 40 farms, ranches and vineyards in the province.

4.5.6 Stewardship Centre for BC

The Stewardship Centre is a NGO focused on strengthening ecological stewardship through providing

technical, educational and capacity building resources, and by fostering partnerships. Agriculture-

focused resources includes free stewardship practices guides covering voluntary practices that can be

undertaken for drainage maintenance and restoration activities in riparian areas. The guides are


38

designed to inform conservation actions for wildlife and SAR and provide specific advice that the

agricultural sector can consider when making land use decisions and developing land management

plans.

4.5.7 BC Agriculture and Agri-food Climate Action Initiative

The BC Agriculture & Food Climate Action Initiative was started in 2008 by the BC Agriculture

Council to enable a proactive approach to agricultural climate change issues. It is supported by the

ARDCorp and the Investment Agriculture Foundation of BC (IAFBC) with funding provided by

Agriculture & Agri-Food Canada (AAFC) and AGRI.

This initiative is focused on developing adaptation strategies for agriculture and currently manages

two support programs focused on education, planning, research and development activities: a

Regional Adaptation Enhancement Program and the Farm Adaptation Innovator Fund (FAIF). The

FAIF program (currently closed to new applications) is intended to build capacity in the agricultural

sector and encourage adoption of BMPs. Up to 80% of total project costs, or 80% of the cash costs

for works completed through BMP Program, are provided to a maximum of $150,000. Both programs

are not designed to provide incentives to producers for climate action, but rather demonstrate the value

of this approach particularly in view of risk management and agri-business opportunities.

4.5.8 Government Agricultural Programs and Support

Agri-environmental advice, technical assistance and extension materials are available from specialists

within AAFC and AGRI. These two agencies also lead the delivery of Growing Forward 2 in BC,

which provides significant funding support to some of the previously described agri-environmental

programming (e.g. EFP, BMP programs) and which can also be used to support other development-

related projects. Project-based, agri-environmental funding support for development activities is

available through IAFBC. And the Agriculture Wildlife Program of AGRI provides compensation

funding to agricultural producers for the financial losses they incur due to wildlife damage to crops

and livestock losses to predators (i.e. compensation for EDS).

4.5.9 Other Government Programs and Support

Technical support on wildlife, SAR and water issues is also available through the BC Ministries of

Environment (MOE) and FLNRO. The MOE, through the Climate Action Secretariat, Climate

Investment Branch (formerly the Pacific Carbon Trust) procures offset agreements with the private

sector to achieve a public sector net-zero greenhouse gas emissions target. The offset program is

proposal driven, and proponents must outline the specific protocols they will use for measurement and

monitoring their climate actions. Agricultural producers in BC are exempt from the provincial carbon

tax (currently $30/t of CO2 equivalent) that funds the offset program.

Environment Canada (EC) / Canadian Wildlife Service (CWS) provides information and technical

support to producers. With funding through the Habitat Stewardship Program, EC supports projects

on agricultural land with financial incentives for protecting SAR. EC/ CWS is also currently

developing a program to work directly with agricultural producers on SAR conservation through the

Species at Risk, Protection on Agricultural Lands (SARPAL) program. SARPAL is developing


39

support mechanisms to encourage SAR conservation, initially focused on the yellow-breasted chat in

the south Okanagan, and is exploring development and delivery partnerships.

Local conservation funds exist in two locales in BC: the Columbia Valley and Kootenay Lake sub-

regions of the East Kootenay Regional District. Established by referendum, the Regional District

collects $20 (Columbia Valley) or $15 (Kootenay Lake) per property parcel located within the sub-

regional boundaries. Funds are distributed by the Kootenay Conservation Program for local

conservation initiatives in those specific sub-regions. While not specifically targeted to agriculture

issues, they can support PES-related work. For example, over the past 5 years the Columbia Valley

fund has awarded over $1,500,000 to 43 local conservation projects including $27,000 to the ESI for

its demonstration work (KCP 2015).

General Conclusion 4.5

� Successful agri-environmental support programs are established in BC,

including a long-running regional PES program.


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4.6 Ecological Services Initiative

Goals and Aspirations

The ESI was established in 2009 to demonstrate and test PES concepts and to determine their viability

in Canada (ESI 2012). The program concept originated with, and development and delivery have

largely been directed by, Dave Zehnder, an East Kootenay rancher who viewed a riparian BMP

project on his family ranch as a means to demonstrate his vision of PES concepts based on personal

knowledge of support programs in Switzerland (Harma 2014).

With a stated vision of "... implementation of a sustainable paid ecosystem services program that

supports ecological integrity and food security in Canada", the ESI's mission has been to:

1. Develop a model for supporting EGS on private land;

2. Test and demonstrate that model in operational settings; and,

3. Initiate a sustainable, long-term and widely available PES program for agricultural producers.

To achieve this vision, the goals of the ESI (ESI 2012) are to:

1. Review scientific and technical information on EGS;

2. Establish demonstration sites and pilot projects;

3. Create a PES model for wide-scale application by 2014;

4. Design and implement biological and economic monitoring at the demonstration sites;

5. Research alternative models and methods of supporting EGS; and,

6. Engage stakeholders.

Structure

The ESI does not have a legal organizational structure. The majority of the ESI development

resources have been channeled through the Windermere District Farmers' Institute (WDFI) and BC

Cattlemen's Association. Individual project works have been carried out through contractual

arrangements with ESI delivery team members and other groups and individuals. The ESI's strategic

plan notes that a 'Program Delivery Team' composed of eight individuals plus contracted "specialists"

was established in the first phase of the ESI. At the time of this review only the coordinator (D.

Zehnder) and an administrator (K. Wells) appear to be active in that role. The ESI has also

established an advisory provincial 'Ecosystem Services Working Group' with managers from:

"Ministry of Agriculture and Lands, Ministry on Environment, ARDCorp, Ducks Unlimited, Forest

Lands and Natural Resource Operations, BC Agriculture Council, Environment Canada" (ESI 2012).

The composition and involvement of individuals on this working group appears to be quite dynamic.

Activities and Outcomes

Since its inception, the ESI has expanded through three overlapping, self-defined phases:

1. A single demonstration site was established in 2010 at the ranch of Dave Zehnder, PES

proponent and ESI project leader, in Windermere (WDFI Ecological Goods and Services 3

Year Demonstration Project). This demonstration site was used to discuss concepts, engage

other stakeholders and frame future development work;


41

2. Beginning one year after creation of the first demonstration site, the ESI's network of

demonstration sites was progressively expanded to 25 locations spread geographically over

BC and Alberta (Harma 2014).5 Technical protocols and procedures were also examined at

this time; and,

3. Establishment of a what was declared as a "sustainable, long-term program" with a multi-

regional model, and the initiation of three regional pilot projects.

In addition to the demonstration work, the ESI activities have included:

• Survey of regional rate payer opinions regarding funding PES programs in the Columbia

Valley (Cameron 2013);

• Literature reviews related to EGS issues and valuation (e.g. EGS in context of EFP,

agroforestry and SAR);

• Creation of program development guidelines and EGS monitoring protocol recommendations

(Gorsuch 2011, Maxcy and Rubridge 2013);

• A cost-benefit analysis of the Zehnder demonstration site (Wells 2011) and a tool for rapid

economic assessment of multiple sites and payment determination (Wells 2013);

• Development of a program extension and communication plan (ESI 2011); and,

• Creation of a framework model for a five-year (2014 to 2019) multi-region plan.

Phase 1 and 2 Demonstrations

Through set selection criteria, the BC-based demonstration projects focused on sites with a completed

EFP, cattle production and an existing BMP project related to riparian health. Activity at the Zehnder

demonstration site included significant data collection and monitoring related to the changes following

the creation of a riparian reserve, including riparian health, biodiversity, waterfowl habitat and water

quality parameters. Monitoring and data collection at the other demonstration sites included one or

more of the following:

1. Compilation of information from existing riparian health assessments (RHA) and /or

biodiversity management plans completed through the BMP Program;

2. Interviews with the producers on management practices and other administrative details to

facilitate payments; or,

3. A qualitative 'ecosystem service assessment' assigning points based on the belief the BMP

implemented would positively contribute to preserving, mitigating or restoring each of the

following:

a. Water quality,

b. Air quality,

c. Riparian habitat,

d. SAR habitat,

e. Genetic diversity,

5 Harma (2014) notes 26 ESI demonstration sites were established as of March 2014, but this number could not be verified and may have included sites at the discussion stage, but not implemented, and others proposed for implementation under phase 3 of the ESI.


42

f. Recreation,

g. Cultural aspects,

h. Multiple use,

i. Fewer weeds,

j. Fisheries,

k. Erosion control,

l. Flood control,

m. Carbon sequestration, and,

n. Improved expertise in agricultural BMP.

Additionally, five sites in the Columbia Valley were used to pilot the ESI's economic assessment tool

(Wells 2013). Producers participating in the demonstrations received between $1000 and $1500 per

year as payment for the presumed beneficial ecological services provided by maintaining a riparian

BMP (e.g. exclusion fencing, off-stream watering systems).

Phase 3 Pilots

Following the initial Forum on Agriculture and the Environment (Bomke 2013), regional interest was

expressed to further develop PES options. At the subsequent Agriculture and the Environment Forum

III (Koch 2014), an ESI Framework Model was adopted for pilot work in the east Fraser Valley to

develop a possible funding mechanism and to identify projects. The framework has subsequently also

been used to initiate regional pilot work in the East Kootenay and Okanagan, each with representation

from a broad cross-section of stakeholder interests. The framework process is an activity outline that

includes the following:

1. Selecting target regions;

2. Holding a preliminary key stakeholder session;

3. Establishing a full program structure;

4. Determining regional ecosystem service priorities within targeted regions;

5. Establishing administration and a 'one stop shop' approach;

6. Establishing initial funding;

7. Establishing ecosystem service goals;

8. Implementing project work;

9. Monitoring results;

10. Reporting results; and,

11. Making improvements.


43

A Lower Mainland working group (encompassing the East Fraser Valley group from Forum III and

other stakeholders) was formed and is in the process of exploring a strategic focus, with initial interest

including6:

1. Water quality and quantity;

2. Biodiversity-general, salmon, SAR and invasive species;

3. Air quality;

4. Pollination; and,

5. Soils, related to:

a. Nutrient loading

b. Erosion

Development of sub-regional pilot projects are underway for Agassiz Mountain Slough, the Chilqua

Creek watershed and in the township of Langley. Additionally, two case studies have been completed

outlining a methodology using survey and mapping techniques to identify and communicate potential

EGS from dairy farms in the east Fraser Valley (Brown et al. 2014).

The East Kootenay working group7 has set a strategic focus for pilot development within three sub-

regions (Columbia Valley, Kookanoosa, Creston) on:

1. Water quality and quantity; and,

2. Biodiversity: "viewable, huntable, fishable" species, as well as, SAR.

The Okanagan working group8 is within an initial exploratory phase, and has expressed interest in the

following agricultural-related EGS:

1. Air quality;

2. Water quantity;

3. Biodiversity and SAR; and,

4. Cultural aspects (recreation and tourism).

After an initial meeting, the Okanagan regional working group decided to divide into sub-regional

groups for development around specific issues focused in either the South Okanagan and

Similkameen, or within the Central and North Okanagan.

In consideration of the work it has completed to date through the three phases of the ESI, the ESI

coordinator and Delivery Team believe they have developed a PES model that is ready for a wider

application, focused at the regional or watershed level, but coordinated provincially (Zehnder 2014).

6 Unpublished Lower Mainland Ecosystem Services Working Group Meeting Minutes, March 27, 2014 and September 25, 2014. 7 Unpublished East Kootenay Ecosystem Services Working Group Meeting Minutes, March 3, 2014 and October 23, 2014. 8 Unpublished Okanagan Ecosystem Services Working Group Meeting Minutes, March 26, 2014 and the North Okanagan Ecological Services Initiative Meeting Minutes, June 16, 2014.


44


� ESI activity has focused on building partnerships, creating awareness,

demonstration and distributing an arbitrary payment to participating

producers.

� Literature reviews and limited technical and economic support tools have

been created.

� The ESI believes it has a PES model that is ready for a wider application to

fulfill its vision of "...a sustainable paid ecosystem services program that

supports ecological integrity and food security in Canada."


45

5. Ecological Services Initiative SWOT and Gap Analyses

5.1 SWOT Analysis

Strengths

The ESI's strengths originate from the increased profile of EGS and PES issues it has created and in

the partnerships that have been established in the work to date, including:

1. Linkages thematically of the ESI to other provincial, national and international PES initiatives.

Agri-environmental issues are increasing in prominence globally, and innovative, collaborative

methods to meaningfully address these issues must be developed and refined.

2. Collaborative approach. The ESI has approached PES from a multi-stakeholder perspective, as

an important element in creating socially acceptable EGS support, and has attempted to address

issues in a manner that bridges agricultural production and conservation interests.

3. Elevated awareness of PES issues in BC have emerged from the extension work carried out to

date. Although a regional program in the Fraser River delta has been in place for over two

decades, and PES concepts have been discussed among agricultural leadership and other

stakeholders at least since the early part of this century, the ESI has succeeded in focusing

attention on EGS and PES concepts recently.

4. Established partnerships. The ESI has engaged multi-stakeholder involvement in the regional

working groups and pilot projects, and has solicited advice and input from EGS and PES experts

both within and outside of BC.

5. Willingness to adapt. The ESI has undertaken a gradual shift in focus and activity from the

initial demonstrations to an emerging multi-regional concept. Continued adaptability will serve

the ESI well to find PES solutions that work within the local social, economic and ecological

realities throughout the Province.

Weaknesses

The principle weaknesses associated with the ESI are derived from pursuing an unrealistic vision,

inadequate reporting and other communications, an incomplete examination of the potential options

carried out in the demonstrations and in the development of the ecological and economic assessment

tools. These weaknesses include:

1. Unrealistic vision. The current program vision is to develop a PES model for Canada. Given the

diversity of regional agricultural production, environmental issues and social norms however, it is

extremely unlikely there is even a single, workable model suitable for BC.

2. Lack of a well-documented rationale. The ESI program materials, including extension

materials and project reporting, do not provide a strong rationale for the program beyond

itemizing general PES concepts or building an argument for PES programs in BC based on

examples of what is being done in other Provinces or countries. The lack of well-documented

rationales, tied to strong, incremental needs for this type of program restricts the ability to secure

development and delivery funding, or to engage a larger group of stakeholders and support from

the general public.


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3. Communications are weak to stakeholders, funders and the public about the program goals,

activities and outcomes. While the ESI has done a good job in elevating the general awareness of

PES in BC through direct presentations, other communications are below the level required for

building and maintaining program support. For example, 60% of the stakeholder survey

participants indicated they had either contributed funding, advice or technical support to the ESI

or were part of the program delivery. Yet, only 31% of survey respondents rated their knowledge

and awareness of the ESI as "high" (Appendix 2, Figs. A-3 and A-4). The ESI strategic and

communications plans lack substantive detail and in places are little more than outlines of areas to

be addressed. Similarly, the 'multi-regional framework' put forward for the phase 3 pilot projects

lacks substance, context and details needed for strategic resourcing decisions. Project reports and

summary documents (with the notable exceptions of Gorsuch 2011, Maxcy and Rubridge 2013)

could be substantially improved. Many of the ESI's reports lack clear and full explanations of the

methods, decision processes undertaken and alternatives explored before engaging in the

development pathway chosen. Important details on locations and specific outcomes achieved are

not thoroughly or clearly summarized. On the whole, the ESI's reporting does not contribute

optimally to a cohesive, focused development effort.

4. Insufficient focus. The ESI's phase 1 and 2 demonstration and pilot project work did not centre

on solving a critical local or regional agri-environmental issue, nor were they targeted enough to

specific EGS outcomes. Most relate to past implementation of BMP projects for improved

riparian health and framed the need for PES around a number of general, not easily quantifiable,

EGS benefits (e.g. recreation, cultural and "multiple use" values).

5. Limited beneficial outcomes from demonstrations and pilot project work. Beyond creating

an additional forum for PES discussion, it remains unclear what of significance has been

accomplished through the ESI's phase 1 and 2 demonstration and pilot project work. This is

partly rooted in the weak reporting and insufficient focus of these undertakings. Some of the

demonstrations appear to have involved little more than dispensing funding to a select group of

producers that met the criteria put forward by the ESI Delivery Team (e.g. working ranch, EFP in

place, riparian BMP project already completed). In this regard, they were not platforms for

meaningful learning and development, but merely to fulfill program activity.

6. Limited utility of ecological and economic protocol development work. The only substantive

ecological/biological monitoring support work undertaken by the ESI was the adoption of riparian

monitoring protocols (i.e. use of the RHA as recommended by Maxcy and Rubridge 2013). Use

of the RHA however, will have limited applicability to potential program delivery, unless a local

area determines riparian health is a critical issue in need of PES support, or it is strongly suited as

a proxy measure for some target EGS. The RHA was explicitly developed primarily as an

educational tool, and if it is to be used as a proxy for a wider range of EGS indicators in BC (e.g.

specific SAR), these need to be validated by research. Similarly, the economic assessment

protocols (Wells 2013) also have limited utility as either a development or delivery tool. The

cost-benefit calculations conducted do not clearly separate public and private benefits, nor do

they clearly account for financial benefits received by the producers through other programs (e.g.

BMP cost-share funding). The funding allocation procedure amounts to little more than a means


47

to use a weighting system to divide funds among producers. Development of the cost-benefit and

economic tool did not include a fulsome review of existing PES economic tools and resources

from within BC or other jurisdictions, nor did it compare the practicality or relative efficiency of

alternative payment calculations (i.e. method of EGS price discovery) or funding delivery options

(e.g. auctions or other market mechanisms) in the BC context.

7. Important baseline information is lacking to justify the widespread use of PES support in BC.

Lessons from existing BC programs have not been analyzed. Public and private benefits are not

clearly separated to determine PES needs. The incremental impact of PES support relative to that

of existing support programs has not been established. Information on the level of voluntary

stewardship in BC and willingness to provide various EGS is sporadic and anecdotal.

8. Limited program linkages. While the ESI leverages the work and, to a certain extent, the good-

will of other agri-environmental support delivery programs (e.g. EFP Program), there are no

formal linkages in place, and there has been limited work directed at how new PES support can

work incrementally to complement other initiatives and support programs (e.g. BMP Program,

Agriculture & Food Climate Action Initiative). The stakeholder consultations revealed that there

is significant confusion regarding the ESI's purpose, activities and program linkages. Some, out

of ignorance of the existence of the BMP Program, believed that the ESI's purpose was to

demonstrate and develop a BMP program. A similar confusion exists about the relationship of

the ESI and the EFP program, where currently no formal linkages exist. The ESI has not

established a formal partnership or sought significant input from the DFWT.

9. Limited linkages to regional or sub-regional planning. The ESI's work to date has not

established the need for a PES program in the context of scale and the potential contributions of

agricultural BMPs at the site level to watershed-, regional- or provincial-level benefits, or the

contributions of other public and private land uses (e.g. private forest land management). The

ESI has not fully explored the opportunities and challenges of addressing these issues through

establishing local or regional PES programs in the context of land use planning, e.g. relationship

to Community Watersheds or Agricultural Area Plans.

10. Limited involvement outside of private land agricultural stakeholders. First Nations

agricultural stakeholders have not been formally engaged in the development process, nor has the

program examined needs or opportunities for agricultural activities on Crown lands.

11. Lack of organizational capacity. Consultations revealed that many regional agricultural

stakeholders and environmental NGOs believe that they do not have sufficient capacity to

meaningfully address EGS issues and PES program development. The ESI does not have the

internal capacity to administer and deliver support programs in line with the development needs.

12. No viable delivery funding. The ESI has not secured a viable funding mechanism or partner for

program delivery.


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Opportunities

There are opportunities to develop and deliver increased support for the stewardship of agricultural

lands in BC, and find a meaningful role for wider use of PES.

1. Learn from established agri-environmental support programs. There are successful,

established agri-environmental programs in BC (e.g. DFWT, EFP Program, BMP Program) that

can provide valuable input for addressing the technical, economic and social information needed

to develop other successful PES programs.

2. Links to agricultural planning. With some coordination and organizational structure, PES

opportunities can be incorporated into the existing EFP Group Planning process or Agricultural

Area Plans to address watershed-level and regional issues.

3. Development funding is available. In contrast to the lack of significant delivery funding

sources, there are significant opportunities to access direct and indirect develop support from

existing regional, provincial and federal programs, both from NGO funding bodies and

government sources, if compelling local and regional rationales are developed and documented.

There are also viable options to fund a multi-regional support body.

4. Expertise is accessible. There is considerable social, economic, scientific and technical expertise

supportive of EGS and PES development and validation work, within both BC and Canada, that

can be accessed through partnerships with universities, Provincial and Federal agencies, and

NGOs. There is also a large pool of private sector consulting resources that can be contracted to

carry out development activities.

5. Public engagement. Limited polling and survey work conducted to date indicates there is an

opportunity through public education to communicate the linkage between maintaining local

agriculture and the EGS enjoyed by society. Through improved awareness and education, public

backing for EGS support programs could be strengthened.

Threats

The primary threat to the continuance of the ESI and for ultimately developing PES delivery programs

is the lack of viable, substantive funding options. Specific threats include:

1. No viable delivery funding available in amounts or scope required for moderate to large-scale

PES programs.

2. Not enough compensation funds available to meaningfully address all stewardship needs on

agricultural lands. Without sufficient financial backing, other regulatory (including self-

regulation) or incentive options must be the primary source of agri-environmental support, and

should be the development focus.

3. No public policy framework in place. Past examinations of the PES concepts by the Federal

and Provincial governments have not resulted in a dedicated policy position or basis to engage

government in PES delivery. There is little indication of a political willingness to re-enter in

public policy development around this issue.

4. No comprehensive land use planning framework to address agri-environmental issues. Opportunities to frame EGS and PES needs and support options within the broader context of all


49

land use management and conservation (on private and public lands) are restricted by the lack of

a comprehensive land use planning mechanism regionally or provincially in BC.

5. PES options may alienate some stakeholders who disagree on a philosophical level on the need

or appropriateness of some types of conservation action. Alienation could contribute to increased

division of agricultural stakeholders with negative consequences for the sector as a whole.

6. Provincial food insecurity could increase if compensation from PES programs is primarily

directed to removing agricultural land in BC from production.

7. Key land use information may not be developed. Land use data sets covering important spatial

information to define issues and identify priority geographic areas has not been created, analyzed

or requires updating. If this support information is not created, effective PES program delivery

will be greatly restricted.

8. Development partnerships may not be created around common goals. The lack of internal

legal structure and organizational capacity in the ESI means it is dependent on the cooperation of

outside parties to fulfill its administrative needs.


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Table 4. SWOT summary.

Strengths

• Links thematically to other provincial, national and international initiatives

• Collaborative approach • Elevated awareness of PES issues • Established partnerships • Willingness to adapt

Weaknesses

• Unrealistic vision • Lack of a well-documented rationale • Communications are weak to stakeholders,

funders and the public • Insufficient focus • Limited beneficial outcomes from

demonstrations and pilot project work • Limited utility of ecological and economic

protocol development work • Important baseline information is lacking • Limited program linkages • Limited ties to regional planning • Limited involvement of agricultural

stakeholders outside of private lands • Lack of organizational capacity • No viable delivery funding

Opportunities

• Learn from established agri-environmental support programs

• Link to broader agricultural planning work • Development funding is available • Expertise is accessible • Public engagement

Threats

• No viable delivery funding options • Not enough compensation funds available • No public policy framework in place • No comprehensive land use planning

framework to address issues • PES options may alienate some stakeholders • Provincial food insecurity could increase • Key land use information may not be

developed • Development partnerships may not be

created


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5.2 ESI Program Gap Analysis

The following elements need to be addressed for the ESI to succeed in meeting its stated goals of

creating and delivering an efficient and sustainable (both politically, financially) PES program. The

program gaps identified reflect the collective input from the review process in the context of the

stakeholder priorities for future program development. The critical institutional/organizational

elements with the current status of the ESI in meeting these needs are as followings:

Leadership / Governance

1.1 Need: Clearly defined, realistic program vision and goals.

1.2 Status: Existing program vision is not realistic; goals need to be redefined in terms of

viable program outcomes.

2.1 Need: Strategic, communications and operational plans.

2.2 Status: Existing strategic and communications plans need revision and substantial

expansion beyond an outline of potential activities.

Operational plans must be developed for the pilot and demonstration projects, each

outlining:

i. Agri-environmental issue addressed;

ii. Target EGS and how success will be measured;

iii. Geographic area included (e.g. Regional District or sub-district, watershed);

iv. Funder(s);

v. Project partners;

vi. Existing support options / incremental role PES will fulfill;

vii. How the scale of the action relates to the scale of the EGS;

viii. Measurement and monitoring protocols (in place and/or to be developed through pilot

work); and,

ix. Resources, timelines and costs.

3.1 Need: Meaningful development and delivery partnerships.

3.2 Status: Regional development partnerships in place, but need to be strengthened around a

common vision and realistic goals. No delivery partnerships in place.

4.1 Need: Defined program roles and responsibilities.

4.2 Status: Program staffing, finance, strategic, communications and technical roles not well

defined. Distribution of authority is not formally defined. Past decision making has not

been fully documented.

5.1 Need: Provision for oversight and due diligence.

5.2. Status: ESI does not have internal audit or compliance provisions.


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Administration

6.1 Need: Administrative support for development and delivery.

6.2 Status: Limited contract-based function for development work to date. Development

funds have been subject to handling charges (up to 10% of the total) for a body with legal

status (e.g. WDFI) to receive and distribute third-party development financing, in addition

to the contracted administrative service costs. ESI has no internal capacity to manage

financial and human resources support, compliance with regulatory requirements or record

keeping and audit procedures for program delivery.

Implementation

7.1 Need: Development and refinement of technical procedures.

7.2 Status: One technical procedure in place for riparian monitoring, all others to be

developed, formally adopted or refined through the work of the pilot and demonstration

projects.

8.1 Need: Management and delivery of technical operations.

8.2. Status: ESI has no internal capacity to manage or deliver technical support.

9.1 Need: Data collection and sharing.

9.2 Status: ESI has an established website and data sharing provisions could be built. Other

information sharing needs significant improvements.

Communications

10.1 Need: Outcomes/performance reporting.

10.2 Status: Ad hoc reporting for fulfilling funding requirements completed. Program

reporting generally needs substantial improvement.

11.1 Need: Extension and outreach activities.

11.2 Status: Successful program awareness activities completed and many formal and

informal presentations delivered by ESI coordinator. Significant gaps however, in

education, extension of technical information and outreach activities to broader base of

agricultural stakeholders.


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6. Recommendations

6.1 Development Focus

In view of the present opportunities and constraints, a

provincial or multi-regional delivery program is not feasible

and not recommended in the near to mid-term (within the next

5 years). The remaining recommendations outlined in this

report therefore, centre on building capacity and focus for

completing a four to five year development cycle. If these

development activities are fulfilled, they can create a more

compelling case for an expanding network of sustainable, local

or regional PES delivery programs, with strengthened

cooperation with other complementary agri-environmental

support programs.

To demonstrate a wider viability of PES in BC beyond the existing regional program in Delta, the ESI

needs to refocus its approach and address its past weaknesses in communicating the program goals,

activities and outcomes. To secure stable, longer-term funding and other support it is not sufficient to

cite situations and programs outside of BC, or simply document the potential general benefits of EGS

from agricultural lands. The suite of recommendations collectively emphasize the need to take

advantage of local and regional opportunities, where a PES program can incrementally generate or

maintain positive outcomes related to very specific agri-environmental issues. It will require building

and maintaining a co-operative, adaptive development approach from agricultural producers, the

environmental community and government agencies. And success will require strengthening

communications and outreach to agricultural producers, environmental advocates, governments at all

levels, funding bodies and the general public.

Acknowledging Diversity and Complexity

Agri-environmental issues continue to evolve and there is an ongoing need to develop and implement

cost-effective, sustainable solutions, that also allow the BC agricultural sector to grow and secure

emerging opportunities.

Because agriculture and environment are intertwined, agricultural interactions and environmental

outcomes are as complex and diverse as the ecosystems in which they reside. Layered upon this

physical complexity are the diverse social and political relationships that influence human action,

underpinned by multifaceted individual needs and desires. There are a wide range of aspirations,

direct and indirect experience with agriculture and nature, as well as biases and philosophical

differences that influence our decisions.

This complexity is not acknowledged as an excuse for inaction, or for the means to find points of

division and conflict, but as a recognition that agri-environmental issues must always be viewed

contextually. What is reasonable and appropriate in one setting, region or commodity group may not

be universally appropriate to other locations, scales, management settings or timings.

Recommendation 1

Support resources should be focused on fulfilling a four to five year development cycle with the goal of creating compelling cases for regional PES delivery programs.


54

Both within and outside the agricultural sector, a diversity of opinion exists on the need for, and form

of, EGS support in BC. This diversity could be viewed as either the greatest challenge or strength to

finding sustainable solutions. To leverage it as a strength, a multi-stakeholder, participatory approach

is needed to address the planning and support needs. Development solutions need to originate from

local issues and priorities, and all parties need to act collaboratively, with a willingness to change and

adapt, and respecting individual needs and priorities.


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6.2 Program Leadership and Organization

6.2.1 Guiding Principles

Throughout the review consultations, certain elements viewed

as needed to ensure long-term, effective programs came

through repeatedly and clearly: support needs to be focused

locally, led by agricultural producers in partnership with other

stakeholders, and delivered in a way that builds and maintains

trust. The following guiding principles reflect these and other

stakeholder values revealed in the review process. They

collectively represent a general philosophy that should guide

the development and delivery of payment and reward systems

for ecological services in BC.

1. Local: programs should originate and operate from local or regional needs and priorities;

2. Producer - led: agricultural producers should take a lead or prominent role in partnerships for development and delivery;

3. Collaborative: support and solutions should be developed collaboratively with all key stakeholders and strive to build and maintain trust;

4. Merit-based: resources will be apportioned based on the highest priority needs;

5. Incremental: new programs and resources should not duplicate existing support and must address needs not achieved effectively by voluntary action or existing regulated standards;

6. Accessible: all interested producers meeting the program parameters should have equality of opportunity to participate.

7. Voluntary: producer participation should not be mandatory and should include options to opt out.

8. Science-based: all measurement and monitoring must rooted in the best available scientific information and compensation needs to be tied to quantitative measurements;

9. Efficient: all programming will strive to minimize the level of administration, and keep transaction costs reasonable relative to the level of producer support delivered;

10. Transparent: the selection of participants, methods and processes used, and payments made will be subject to a high level of scrutiny and disclosure. Audits and regular, meaningful reporting will be used to maintain trust; and,

11. Practical: measures will only succeed if they do not impose additional management challenges on agricultural producers and their partners in order to participate.

Recommendation 2

Development and delivery of payment for ecological services support programs should adopt and follow a set of guiding principles reflecting the strengths and opportunities for EGS support in BC and reflecting the diversity of stakeholder values and priorities.


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6.2.2 Vision and Strategic Focus

The ESI's vision statement is unrealistically targeted at creating

a PES model for Canada. The Initiative should realign its

mission and strategic goals to fulfill an attainable vision of

facilitating the development of local and regional PES

programs in BC. The ESI's goals and operating procedures

then need to reflect this vision. For example, in the current

terms of reference for the Lower Mainland ESI Working

Group, the role of the working group is set to "...act in an

advisory and support capacity to the ESI." This and similar

policies should be realigned to reflect the new vision, e.g.: "The

ESI will act in an advisory and support role to the local and

regional working groups."

The strategic goals of the pilot projects also need to be assessed

and validated before additional development work is

undertaken. As a start, each project's focus must clearly

articulate a very specific purpose by defining the:

i. Local agri-environmental issue addressed; ii. Target EGS; and, iii. Geographic area included.

Instead of declaring a strategic focus of SAR issues, it should note the individual species and

geographic area by name and the EGS variable(s) targeted for stewardship. For example, the amount

and health of yellow-breasted chat riparian habitat in the Okanagan-Similkameen Regional District.

Likewise, instead of targeting "water quality", the specific water quality parameters of concern related

to a named watershed or water body should be described. For example, phosphorus loading related to

nutrient management around Big Water Lake.

Within specific pilot projects there may be additional farm-level demonstrations established to test and

refine BMPs, or to create or adapt measurement and monitoring protocols. These demonstration

activities must fully align with the strategic focus and goals set for the pilot project(s) they support.

Once a strategic focus has been set, the first step in the development process should be completion of

a more detailed needs assessment. Relevant land use information, environmental and production

profile data should be compiled to determine if the strategic focus is justified, and to map out the

potential role of PES. Figure 10 outlines a proposed 'decision path' to aid in finding an appropriate

role for PES support in solving agri-environmental issues.

Recommendation 3

The ESI should fulfill a vision of facilitating and supporting the creation of sustainable local and regional PES programs established to address their issues and needs.

Recommendation 4

New and existing ESI pilot projects should set issue-specific strategic goals, and should validate their projects with formal needs assessments.


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Figure 10. Decision path for determining the incremental need for PES support.

Step 1: The focus must address a critical local issue, as determined by the consensus of working

group, and validated by creation of a multi-stakeholder partnership to work towards a solution. Other

issues can be addressed by existing support directed at raising awareness and education provided by

the EFP Program and other producer support programs.

Step 2. The underlying issue is classified as to whether it is primarily: a. Disservice received by agriculture; b. Disservice or negative externality created by agriculture; or, c. Positive externality created or maintained by agriculture.

Step 2 a. Compensation for disservices received by agriculture (e.g. crops or feed stores damaged by

wildlife) should be matched to the existing provincial Agriculture Wildlife Compensation Program to

determine if there are support elements required but not covered in that program.

Step 2b. Disservices or negative externalities created by agriculture, must be examined to determine if

they likely meet the current regulated definitions for pollution; if so, then regulation and enforcement

and/or existing support from the EFP and BMP Programs to aid producers in meeting compliance


58

should be utilized.9 If pollution is not a prevalent component to the focal issue, then assess other

existing support to determine if there are incremental support needs.

Step 2c. For issues related to positive externalities created or maintained by agriculture, the relative

private and public benefits should be evaluated. Where private benefits are very high and public

benefits are low, existing support can sufficiently address the issue. Where private benefits are low

and public benefits are high, assess the existing support to determine if there are incremental support

needs.

At the pilot project stage, the available information may be insufficient to provide full clarity on the

appropriate pathway. For example, there may be no cost-benefit information to aid in separating

public and private benefits. These information gaps should be addressed directly in the development

of the pilot.

The needs assessment can be completed as a stand-alone exercise, or as part of a larger group planning

process to create the operational plan upon which the pilot project will operate. In addition to (i)

identifying and validating the underlying issue, (ii) target EGS and (iii) geographic scope, the

operational plans should provide the following:

iv. Development and delivery funder(s) should be identified and engaged to participate in the

development process whenever possible;

v. Project partners, including the local or regional host organization for the development work

and each group's roles and responsibilities;

vi. A detailed examination and documentation of the existing support options to assess the

incremental role PES will fulfill (or an explanation of how this will be determined through

the pilot project work), including the role of self-regulation and other voluntary stewardship

initiatives (e.g. ProAction proposal of the Dairy Farmers of Canada, Salmon-Safe BC);

vii. An explanation of how the scale of the action where BMPs are to be applied or maintained

relates to the scale of the EGS (i.e. does it operate at local, regional, provincial or global

scales). If the target EGS operates primarily above the local or regional level or on multiple

scales, then linkages to national and international initiatives should be identified (e.g.

international conventions and conservation efforts for migratory birds);

viii. Measurement and monitoring protocols that are in place and/or to be developed through pilot

work. Before new or additional producer payments are made through the pilot projects and

demonstrations, the valuation parameters must be set, including a clear indication of what is

being paid for (i.e. the positive outcomes created or maintained). It should explicitly state if

the target EGS is being measured directly, by proxy or if payment is to be based on a change

in practices and the EGS benefits are implied; and,

ix. Resources, timelines and costs, with the role and resources the ESI will provide outlined.

9 Individual farm assessments should be carried out under the confidential EFP process.


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The EFP Group Planning (EFPGP) process is a suitable option to complete the pilot project planning

and validation work, and offers a funding mechanism for its completion. The EFPGP process has the

added benefit of adding a layer of validation to determining the appropriateness of the project strategic

focus, in that the proposed group plan must first pass a set of selection criteria for inclusion in the EFP

Program. It is also suggested that, in agreement with the selection criteria already established for the

ESI demonstrations, all producers participating in the pilot project work and ultimately accessing

funding from potential PES programs, should have an EFP completed or renewed within the past five

years.

It is also very important to note that if it is determined during either the validation or development

process that PES does not fit the needs of addressing a given local agri-environmental issue, that by

itself does not invalidate the importance of the underlying issue. It merely focuses the resolution on

other means of support.


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6.2.3. ESI Organizational Structure

The lack of organizational capacity and resources within

agricultural groups and NGOs to meaningfully address the

PES development process represents a significant barrier to

EGS support across the Province. In overcoming this

weakness, a balance must be achieved between keeping a

local or regional focus and the efficient use of limited

development resources. Out of efficiency therefore, some

coordination and support should be provided from a central

body, and paid, professional development support directed by

that body can be provided to new or existing regional

initiatives. In support of increasing the transparency of the

ESI, the program delivery roles should be separated from the

decision makers.

The ESI should be reorganized (Fig. 11) to facilitate positive outcomes from the pilot projects with the

ultimate goal of initiating local or regional PES programs. To achieve this, a group structure should

be adopted where the current project coordinator role is transformed to a project development and

communications facilitator reporting to a newly created Agricultural Ecosystem Services

Development Council (AESDC, the 'Council').10 The Council would formally direct the activities of

the ESI to achieve goals in line with a vision of supporting various local and regional priorities. The

AESDC would also retain the services of an administrator to serve needs of the ESI and also to

provide administrative services to the local and regional pilot projects, as needed. Funding for

individual pilot and demonstration projects could flow directly to individual projects, if they have the

internal capacity to administer the funds, or could be channeled through the ESI. For the purposes of

banking, insurance and other fiduciary responsibilities, a willing organization with legal standing (e.g.

corporation or registered society) will be required to support the AESDC and ESI.11 A group of ex-

officio (non-voting) advisors could be formalized to provide advice, as requested by the Council. To

avoid any real or perceived conflicts of interest, the Facilitator and Administrator positions must

exclude anyone serving on the AESDC.

A summary of the proposed organization resource requirement estimates is provided in Table 5.

10 Working title. This body should set its own name at the initial group planning meeting. 11 ARDCorp management has expressed a willingness to engage in discussions to provide this service, with the ultimate decision dependent on the conditions that new resources can be secured to cover all of the associated costs and that the ESI formulates a transition plan, with the acceptable terms of reference, timelines and budget.

Recommendation 5

Reorganize the ESI to a council structure for decision making supporting local and regional pilot projects with paid administrative, project development and communications support.


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Figure 11. Proposed ESI organizational structure.

Primary Roles and Responsibilities

Agricultural Ecosystem Services Development Council

• Composed of 6 to 8 members, equally representing agricultural producers and environmental

or conservation-focused NGOs. Attempt to balance regional, conservation and production

perspectives in the Council make-up. Rotating or alternating Chair.

• Select and retain Facilitator and Administrator.

• Develop and approve annual work plans and budgeting (with works carried out by

Administrator); maintain and update strategic and other ESI plans (with works carried out by

Administrator or Facilitator, as appropriate to the plan), as needed.

• Quarterly meetings to review and prioritize support requests from pilot projects, as well as

other business relevant to the Council.

• Maintain formal minutes of development and support decisions.

Facilitator

• Reports to, and takes direction from, Council.

• Provides project development assistance to pilot projects and demonstrations in line with an

annual work plan.

• Provides communications and extension support to pilot projects and demonstrations.

• Carries out general awareness and outreach activities.

• Liaison and coordination with other organizations and initiatives, as directed by Council.

• Compiles information from individual pilot projects and shares with other stakeholders.

• Quarterly and annual reporting on activities, outcomes and issues for Council's consideration.


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Administrator

• Reports to, and takes direction from, Council.

• Provides administrative and secretariat support to Council and the ESI.

• Fulfills administrative functions for pilot and demonstration projects, as requested and

required.

• Quarterly and annual reporting on activities, outcomes and issues for Council's consideration.

Ex-Officio Advisors

• Non-voting members of Council or a separate committee (possibly mirroring the composition

of the existing provincial ESI working group with representatives from government agencies,

local government and academic institutions) available to provide strategic advice and

technical support to the ESI.

Pilot Project and Demonstration Coordinators

• Contracted or in-kind support responsible for the development and execution of individual

pilot project or demonstration work plans.

• Submits annual request based on approved work plans to Council for specific administrative,

project development and communications support to be provided by the ESI.

Table 5. Organization resource requirement estimates

Item Costs Time Frame

Council per diems and travel expenses

$16,000/year12 Annually for 4 to 5 years after adoption of new ESI structure

Facilitator contracted services and travel expenses

$30,000 to $40,000/year Annually for 4 to 5 years after adoption of new ESI structure

Administrator contracted services and travel expenses

$15,000 to $20,000/year Annually for 4 to 5 years after adoption of new ESI structure

Overhead expenses To be determined once a delivery contract is established.

Annually for 4 to 5 years after adoption of new ESI structure

Total $61,000 to $76,000/year plus overhead costs

12 Assumes four annual meetings (three teleconferences, one in-person) with $250 per diem and associated travel expenses for each Council member.


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Major Risks Associated with this Recommendation

1. The proposed organizational structure attempts to balance the need for development work to

centre on local issues and priorities, with the efficiencies that can be gained from having some

centralized resources. It is recognized however, that even with this facilitated support, some

local or regional groups may still not have sufficient internal resources to participate in the PES

development process;

2. If the current ESI Delivery Team does not adopt a structure, transition and work plan acceptable

to any potential host organization, this recommendation cannot be fulfilled. In this event,

creation of a new standalone NGO with society status could be explored as an option for the

ESI's organizational body; and,

3. If the ESI fails to secure funding to resource the creation of the AESDC, facilitator and administrator positions and associated overhead costs, the new organization cannot be implemented.


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6.3 Stakeholder Engagement and Communications

Effective communications and active engagement of

stakeholders, both with those directly involved and also

outside of the development process, is vital to the short- and

long-term success of PES programs in BC. Improved

communications are also of paramount importance to the

ultimate success all of the development recommendations in

this report. A more substantive strategy should be developed

that addresses the communications needs of the ESI in four

important areas:

1. Internal communications and reporting.

Reporting on planning, activities and outcomes of the ESI

must contain sufficient detail and clarity to provide

confidence in the ESI's work and that it is building a compelling case for regional delivery

programs. The formal minutes of the ESI need to clearly document who contributed to the

decision making and the outcome reports need to include clear and full details on the activities

undertaken and how the results support the program goals.

2. Pilot project and demonstration project communications. Existing pilots and demonstrations

need to document how and why development pathways were chosen, and what specific outcomes

and lessons were learned in the pilot implementations. Documenting and sharing the options

explored, and decision process involved in developing the demonstrations and pilot projects is

often as important as the actual results they generate, if they are to serve as lessons and platforms

for program development. Outreach and extension of regional pilot project activities would be

aided by holding annual field days to bring in stakeholders outside of the development process

and members of the general public.

3. Public awareness and stakeholder outreach. Public knowledge and understanding of EGS

issues and the role of agriculture is very low. This undermines building long-term support for

PES programs and accessing public and other funding sources. There needs to be a more

targeted, cost-effective campaign to engender public support. The ESI should frame EGS and

PES issues in lay terms and provide success stories where PES solved local or regional issues.

Improved communication of the ESI's goals and activities needs to be directed to stakeholder

groups, including agricultural producers, environmental NGOs and funding bodies. Increased

communications and outreach activity should be directed to local and regional agricultural

organizations (e.g. Farmers' Institutes, local commodity-based groups) and environmental NGOs

(e.g. Stream Keepers network) who may not be directly involved in the development process to

keep them informed of ESI-related goals and activities and to explain the need for PES work at

the 'grass-roots' level.

4. Agricultural producer education. Producers need be educated on the scope and inter-

relationships of agriculture and EGS. This information needs to be focused on aiding an

Recommendation 6

Revise and expand the ESI communications strategy to improve awareness, education, information exchange and stakeholder outreach outcomes.


65

improved understanding of how EGS across all spatial scales relates to individual production

settings.

The communications plan should delineate the specific tools and information channels that will be

employed (e.g. specific web-based outlets and social media, stakeholder conferences and publications)

and set realistic, measurable activity targets. A summary of the proposed communication resource

requirement estimates is provided in Table 6.

Facilitator Roles

Professional communications support is needed to fulfill the ESI's goals, and the proposed ESI

facilitator (recommendation #5) must have both strong verbal and written skills, with the ability to

provide support appropriate to technical and general audiences.

The facilitator should serve four key functions in the communications process:

1. Create and maintain the ESI communications strategy;

2. Develop and support internal communications and reporting for the proposed AESDC;

3. Assist regional pilot and demonstration projects fulfill their communication and outreach needs;

and,

4. Conduct general public and stakeholder outreach and awareness on ESI activities.

In line with the recommended repositioning of the ESI's vision and goals to focus on supporting local

and regional groups to develop PES solutions, support should also primarily centre on local and

regional pilot project communications needs.

Outside Support

It is recommended that agricultural producer education related to EGS be developed and delivered by

other established support programs, with input from the ESI. A strong candidate for the development

and delivery of producer education and extension is through the EFP process. This would require the

cooperative development of new material for the next iteration of the EFP guidebook and related

materials. These could incorporate the process (or a simplified version) of the farm-level EGS

assessment developed by the FVWC (Brown et al. 2014).

There is real social value in elevating the awareness of the positive role agriculture plays in providing

EGS to society. This messaging will not necessarily translate to a direct monetary value of EGS and

compensation in BC, but it will assist in building and maintaining the good reputation of the

agricultural sector. Success stories from the regional pilot projects and research and demonstration

documenting positive EGS relationships to agricultural BMPs should be communicated back to

individual producer associations and BC Agriculture Council to assist in their ongoing public relations

efforts.


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Table 6. Communication resource requirement estimates

Item Costs Time Frame

Revise and expand ESI communications strategy.

Included in Recommendation 5

Within first year of adopting new ESI structure

Facilitated support for program awareness, extension and reporting activities.

Included in Recommendation 5

Ongoing for 4 to 5 years after adoption of new ESI structure

Producer education. To be determined. Within the next revision cycle of the EFP materials or as determined by other delivery organization.

Raise public awareness to build recognition of agriculture's positive contributions to EGS.

To be determined. Ongoing.


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6.4 Research and Development Support Priorities

In addition to supporting new and existing pilot project activities, additional research and development

support is needed to create information in five key areas:

1. Social/behavioural information;

2. Cost-benefit analyses and economics;

3. Land use data and spatial analyses;

4. Cost-effective measurement and monitoring tools; and,

5. BMPs that create strong co-benefits.

The ESI, within either its current or proposed new structure, does not have the internal capacity to

address these information needs. The Initiative will therefore need to continue to engage in liaison

and partnerships with outside organizations (e.g. universities, federal and provincial government

agencies) to encourage the development and completion of the research requirements fulfill these

recommendations.

6.4.1 Learn from Existing Programs

With longer-term PES and EGS support programs already in

place in BC (e.g. DFWT, BMP Program) there is an

opportunity to use these programs as a platform to conduct

new and retrospective studies to learn from their strengths

and weaknesses, and the potential to expand or replicate

their successes to address emerging opportunities and

challenges.

A major omission in the ESI's work to date, has been the

lack of a strong partnership with the DFWT, BC's only

operational PES program. Some strengths of the DFWT are

readily apparent and conform to the elements that are

common among successful PES programs around the world (see section 4.2.2):

• The impetus for the creation of the DFWT was in solving a tangible, regional agri-

environmental issue (agriculture-wildlife conflicts related to migratory waterfowl in the Fraser

River delta);

• The program was developed and is led by a partnership of agricultural producers and local

conservation interests, and enjoys the advice of and support of many local, provincial and

federal organizations;

• Payments complement, but do not overlap significantly with other available support;

• Payments to producers are based on implementation of easily measurable, practical BMP

solutions that support co-benefits for agriculture and wildlife, and,

• The Trust enjoys access to long-term stable funding.

Recommendation 7

Conduct social, economic and BMP research, primarily by synthesizing pertinent information and retrospective analyses of existing programs and activities in BC.


68

Agricultural support, including cost-share funding has also been delivered through the EFP and BMP

Programs since 2004. With incremental resources obtained to pay for the research costs, all three of

these programs would be valuable avenues to address some of the information needs of the ESI in

determining the needs and types of new PES support that should be developed. The priority research

topics to be addressed by this work are as follows:

• Social research to assess BMP adoption rates of select practices (riparian and biodiversity related) among producers that have, and have not, received support funding through the DFWT/BMP Program;

• Retention levels of BMPs, 5 to 10 years after installation to clarify the need for support payments beyond one-time, up-front cost-sharing of capital costs and installation;

• Identification of real production costs (operational and maintenance) and benefits resulting from select BMPs (riparian and biodiversity related), based on actual producer experience to inform the development of more rigorous BMP cost-benefit analyses;

• Trial exploration of the effectiveness and cost-efficiency (i.e. transaction costs) of distributing BMP support funding by application relative to reverse auction methods; and,

• Survey work to document educational outcomes from producers that have, and have not, participated in DFWT and / or EFP programs.

6.4.2 Expand Geographic Information

Measurement and monitoring of EGS, producer enrollment

and payment levels all depend, at least in part, on GIS

resources to make informed decisions. Achieving these

goals would benefit initially from an expansion and updating

of the Agricultural Land Use Inventory (ALUI) datasets

maintained by AGRI, updated and improved SAR and

riparian habitat inventories, and better linking of water

quality data sets to other geographic and land use profiles.

User-friendly, web-based tools and geographic information

system (GIS) resources should also be improved, primarily

through existing platforms (e.g. Hectares BC, iMapBC).

Investments in other complementary spatial data collection

techniques and GIS related research is also needed. For example, an improved understanding of

effects of different agricultural production systems and practices on EGS at different scales, can

inform the development and use of BMPs. Cost-effective monitoring techniques are needed and their

correlation to more rigorous on-the-ground inventory and assessment work should be examined. For

example, low-level aerial surveillance drones could be tested for collecting visual records of riparian

habitat, and the level of correlation tested to concurrent riparian health or inventory assessments.

Similar techniques could be explored for refining SAR habitat boundaries to quantify overlap with

agricultural lands and cost-effective means for mapping wildlife travel corridors in relation to

agricultural lands.

Recommendation 8

Support the creation, updating or expansion of geographic data sets and tools related key EGS inventories and agricultural land use, condition and trends.


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6.4.3 Innovative BMP Development

Some agri-environmental issues may not be fully addressed

by the current range of BMPs and planning resources. The

ESI should continue to explore opportunities to collaborate

with academic (universities, technical institutes) and

government research programs, or other support programs

(e.g. BC Agriculture and Agri-food Climate Action

Initiative), to generate mutually beneficial information from

the regional pilot projects and demonstrations.

Emphasis should be placed on encouraging research that

leads to the development or refinement of production

options and BMPs that convey strong co-benefits to

achieving agricultural production and conservation goals.

Integrated production options in BC meriting further development include many agroforestry systems,

including:

• Silvopasture and integrated riparian management options for extensive livestock operations;

• Shelterbelts and hedgerows for field crop producers;

• Multi-species hedgerows and vegetation buffers for berry and tree fruit producers that

encourage pollinator diversity and natural pest management options; and,

• Vegetation filters and buffers to abate farm dust, odours and noise.

New method s that allow producers to address their contributions to cumulative watershed-level effects and non-point source agricultural contributions should also be explored, including:

• Refining and expanding nutrient management planning tools and associated BMPs;

• Drainage management and water storage practices that meet agricultural production needs and

provide co-benefits to wildlife; and,

• Planning and BMPs that improve agricultural water-use efficiency, particularly in regions

subject to episodic drought.

Recommendation 9

Work collaboratively with outside research and development programs to develop and refine BMPs that create co-benefits for agricultural and conservation goals.


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6.5 Building the Foundations for Delivery Funding

A solid rationale to establish additional regional PES delivery

programs will only exist after the process and results of the

pilot projects are well documented and supported by all

stakeholders. Part of the demonstration and pilot project's

purpose should be to engage potential delivery funders early in

the development process and have them participate as much as

possible in the program development. The nature of support

ultimately delivered will, of necessity, reflect what type and

level of resources someone is willing to provide. And with

many potential combinations of focal EGS and payment mechanisms it is difficult to select one or

even a few general options that will work consistently across the province. This underscores the need

to enlist payers for EGS in development work at the local and regional levels.

Funding or other incentive options that involve the creation of new taxation, mandatory

environmental offsets or other changes in government policies, at any level (local, regional,

provincial or federal) must be explored by a non-government party using non-government

development resources13.

Some market-driven opportunities for tradable environmental credits could be explored directly with

brokers of these credits (e.g. KMPG, Offsetters). Other private funding opportunities from charitable

or grant-providing organizations or business to business arrangements could be explored through the

services of professional fund-finding consultants.

Some support needs may be addressed by liaison with other

programs to encourage changes that address gaps in their

support delivery. For example, with changes, the BMP

Program could deliver funding multi-year establishment costs

(e.g. for weeding, replanting early mortality and irrigation

costs on difficult to establish riparian restorations). Similarly,

a portion of the BMP Program's funding could be reallocated

by a proposal-driven, merit-based system allowing for a

sliding cost-share arrangements, where high priority regional

issues would qualify for additional funding incentives to drive

adoption of BMPs.

New EGS-related branding, labelling or certification schemes would be counter-productive and add

to the general level of consumer confusion. Branding and certification efforts should rely entirely on

external initiatives underway through individual agricultural producers associations, or ARDCorp's

exploration to combine certification efforts within one sustainable sourcing method, or by looking to

existing third-party pan-agricultural certification schemes (e.g. Salmon-Safe BC).

13 Strategies to access government support are outside of the terms of reference for this review.

Recommendation 10

Engage potential delivery funders in the development process.

Recommendation 11

Explore alternative means to fund EGS support activities on agricultural lands through existing programs and initiatives.


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6.6 Improving Program Linkages

Building and maintaining meaningful development and

delivery partnerships will ensure the short- and long-term

success of the ESI. Most of these partnerships should flow

from the multi-stakeholder working groups created to

implement pilot projects and demonstrations, and be dictated

by the specific nature of the development work undertaken.

The following guidelines should be considered to help

assemble and maintain project partnerships that leverage,

whenever possible, existing third-party resources, protocols

and information networks:

• Land use information should be developed

such that it is compatible with, and builds upon, the ALUI data sets maintained by AGRI;

• Establish development partnerships or agreements for work in localities with existing

regional agri-environmental programs (e.g. DFWT, Abbotsford Soil Conservation

Association, Langley Environmental Partners agricultural program);

• SAR-related development work should align with the priority species established in either the

BC Conservation Data Centre rankings or the federal SARPAL pilot projects. All SAR

related project and development work should include meaningful participation of the MOE

and EC/CWS. Wherever possible include local or regional government planners involved

with links to the Species and Ecosystems at Risk Local Government Working Group;

• Other wildlife-related projects should involve MOE and also EC / CWS when pertaining to

migratory waterfowl and trans-provincial or international issues;

• Water-related development work should include appropriate representatives of the MOE and

FLNRO, local or regional water purveyors and boards;

• Any development work directly related to fish-bearing habitat should include representatives

of the MOE and Fisheries and Oceans Canada;

• On commodity-specific issues, work should be undertaken incremental to the voluntary

standards set or being established by various agricultural associations, e.g. ProAction

initiative proposed by the Dairy Farmers of Canada; and,

• Regular liaison and ongoing input should be sought from regional agricultural advisory

committees, local and regional agricultural associations (e.g. Farmer's Institutes) and

environmental NGOs (e.g. Stream Keepers network) who may not be directly part of the

development process.

Recommendation 12

Build and maintain meaningful partnerships and linkages to third-party resources, protocols and information networks for program development.


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6.7 ESI Path to Success

The recommendations outlined in this report provide guidance on the structure, operation and strategic

actions the ESI should undertake to position itself for long-term success. A summary of the steps that

should be undertaken is as follows:

Transition Period

1. Current ESI Delivery Team drafts a transition plan for formal development partnership with

ARDCorp, or alternate administrative body:

• Outline the proposed organization structure;

• Develop funding applications or request amendments to existing funding arrangements, as

needed; and,

• Submit a formal request to establish new ESI organization structure and delivery partnership.

2. Inform the working groups of the transition plan, and initiate a pilot project transition process. For

each pilot project (as needed):

• Complete applications for group planning costs (through EFP Program); and,

• Complete project needs assessments.

3. After successfully securing an administrative body, initiate the AESDC:

• Draft the terms of reference and invite participants;

• Hold an initial AESDC meeting to formally adopt the new ESI organizational structure, vision

and set strategic goals; and,

• Contract the administrator and facilitator positions.

4. Facilitator to:

• Revise strategic and communications for AESDC approval; and,

• Initiate dialog with existing and new development partners for pilot project support.

5. Administrator to:

• Prepare annual budget for AESDC approval.

Begin full operation of the new ESI for a 4 -5 year development cycle

1. AESDC to:

• Receive needs assessments with requests for project support from existing pilot projects and

demonstrations;

• Issue a call for new groups to develop local or regional pilots;

• Prioritize developments and approve administrative and facilitator resources and annual work

plans in consultation with ex-officio advisors;

2. Facilitator to:

• Carry out approved annual work plan centred on supporting the successful development and

communications of local and regional pilot projects;

• Initiate formal partnerships for addressing the research and development priorities;


73

• Liaise with other programs to explore opportunities to strengthen support.

3. Administrator to:

• Carry out approved annual work plan centred on supporting the successful administration of

local and regional pilot projects; and,

• Work project funders, the administrative body and the AESDC to ensure timely and efficient

completion of all fiduciary and reporting requirements.

At the completion of the 4 -5 year development cycle

AESDC to:

• Initiate a review of the ESI program outcomes in relation to the stated goals and assess the

need for ongoing programming, and in particular, assess the viability of new local or regional

PES programs; and,

• Adjust or abandon the development process as determined by the review.


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Appendix 1. Acronyms and Abbreviations

AAFC Agriculture & Agri-Food Canada

AESDC proposed Agricultural Ecosystem Services Development Council

AGRI British Columbia Ministry of Agriculture

ALUI Agricultural Land Use Inventory

ALUS Alternative Land Use Services program

ARDCorp British Columbia Agricultural Research & Development Corporation

BCMAL British Columbia Ministry of Agriculture and Lands

BMP Beneficial management practices

CIRAD Centre de Coopération Internationale en Recherche Agronomique Pour le Dévelopement (Centre for International Cooperation on Agronomic Research for Development)

CCA Canadian Cattlemen's Association

CREP Whatcom County Conservation Reserve Enhancement Program

CRP Conservation Reserve Program

CWS Canadian Wildlife Service

DFWT Delta Farmland and Wildlife Trust

EC Environment Canada

EDS Ecological disservices

EFP Environmental farm plan

EFPGP Environmental farm plan group planning

EGS Ecological goods and services

ESI Ecological Services Initiative

EU European Union

FRISP Farm Riparian Interface Stewardship Program

GIS Geographic information system

HST Harmonized Sales Tax

IAFBC Investment Agriculture Foundation of BC

KCP Kootenay Conservation Program

LCF Local conservation fund

MEA Millennium Ecosystem Assessment

NGO Non-governmental organization

NPS National Park Service

OCCP Okanagan Collaborative Conservation Program


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PEI Prince Edward Island

PES Payment for ecological services

RHA Riparian health assessment

SAR Species at risk

SARA Species at Risk Act

SARLGWG Species at Risk Local Government Working Group

SARPAL Species at Risk, Protection on Agricultural Lands

SOSCP South Okanagan Similkameen Conservation Program

SWOT Strengths, weaknesses, opportunities and threats

USA United States of America

USD United States Dollar

WDFI Windermere District Farmers' Institute

WRP Wetland Reserve Program

WWF World Wide Fund for Nature (formerly World Wildlife Fund)


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Appendix 2. Opinion Survey Results

Figure A-1. Opinion survey results to the question: "Which region(s) do you operate in?"

Figure A-2. Opinion survey results to the question: "What best describes your primary

affiliation?" (n=110)


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Figure A-3. Opinion survey results to the question: "Please indicate your level of awareness/knowledge for each of the following" (n=110)

Figure A-4. Opinion survey results to the question: "Please indicate your level of involvement to date with the Ecological Services Initiative"(n=110)


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Figure A-5. Opinion survey results to the question: "Please rate the importance of the following ecological goods and services from agricultural lands" (n = 110).

Figure A-6. Opinion survey results to the question: "Relative to your other professional / organization's priorities, how do you rate supporting stewardship of agricultural lands?" (n = 110)


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Figure A-7. Opinion survey results to the question: "Please rate the degree to which you believe the following could positively influence the stewardship of agricultural lands in BC " (n = 108).

Figure A-8. Opinion survey results to the question: "Relative to other agricultural or environmental support needs, how do you rate the need for an ecological services support program in BC?" (n = 109).


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Figure A-9. Opinion survey results to the question: "Please rate the importance of the following as a means to support the provisioning of ecological goods and services from agricultural lands" (n = 108).

Figure A-10. Opinion survey results to the question: "What do you believe are the best long-term funding options for ecological services support program delivery?"

agriculture and ecological services: recommendations for ... · • payment for ecological services...

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