The Minimal Effect Exemption Explained

Are you considering a cleaning or draining project on your farm? If you participate in the United States Department of Agriculture (USDA) farm program you will need to consider whether your project might convert a wetland and make you ineligible for certain program benefits.

The Food Security Act of 1985 (a/k/a “Swampbuster”) together with the Food, Agriculture, Conservation and Trade Act prohibits farmers who participate in USDA programs from converting wetlands to make the production of an agriculture commodity possible, even if an agricultural commodity has not actually been produced.

Here is a great article, written by two of my Rinke Noonan colleagues, discussing the importance of completing form AD-1026 to determine whether an activity may result in a violation. It is also possible that your project may qualify for one of several potential exemptions—an applicable exemption could keep you eligible for farm program benefits.  Some of the potential exemptions include the following:

• Prior Converted Wetlands – These are wetlands converted prior to December 23, 1985, on which an agricultural commodity was produced at least once prior to this date, and as of this date did not support woody vegetation.

• Artificial Wetlands – Wetlands created due to the activities of man.

• Manipulated Wetlands – Wetlands that have been manipulated but not for the purpose of, or making possible, the production of an agricultural commodity.

• Maintenance (i.e. Scope and Effect) – In certain cases drainage may be maintained as it existed prior to December 23, 1985.

• Third Party Exemption – For a wetland that was converted after December 23, 1985 by a third party who is not associated with the producer, and without the producer’s collusion, fraud, scheme, or device.

• Minimal Effect – An exemption that NRCS may grant to a producer for a conversion of a wetland if the action will have a “minimal effect” on the functional hydrological and biological values of wetlands in the area.

What are minimal effects and how are they determined? 

Applicable regulations provide that NRCS shall determine whether the effect of any action of a person associated with the conversion of a wetland has a minimal effect on nearby wetlands.  Such determination shall be based upon an assessment of functions and values of the wetlands under consideration and other related wetlands in the area and will be made through an on-site evaluation. Therefore, if you believe a potential project would qualify for the minimal effect exemption, you have a right to request and require that the Natural Resource Conservation Service (NRCS) make a determination on the potential minimal effects of your project prior to beginning any activities.

It is important to note that the applicable regulations require that a request for a minimal effect determination must be made prior to the beginning of activities that would convert the wetland.  If a person has already converted a wetland and then later seeks a determination that the effect of such conversion on a wetland was minimal, the burden will be upon the person requesting the exemption to demonstrate to the satisfaction of NRCS that the effect was minimal.

In other words, if NRCS finds that an activity converted a wetland you still have an opportunity to seek a minimum effect exemption.  However, if the activities have already begun, the burden of proof shifts to you to demonstrate to the satisfaction of NRCS that any impact to the functions and values of wetlands was minimal—this often requires the use and expense of a qualified professional consultant. 

What if you receive a minimal effect exemption?

The production of an agricultural commodity on any portion of a converted wetland made in conformance with a minimal effect determination will not result in a loss of farm program benefits. However, any additional action of a person that changes the functions and values of a wetland for which a minimal effect determination has been made can result in the loss of a minimal effect determination.  The loss of a minimal effect determination will cause a person who produces an agricultural commodity on a converted wetland after the change in status to be ineligible for certain USDA benefits.

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