Governor Newsom recently released his proposed state budget, which includes ongoing investments in Climate Smart Agriculture programs, like Healthy Soils and SWEEP, and new investments in small farm advisors, regulatory streamlining and more.

Below is a summary of the Governor’s proposal and what it means for the state’s efforts to achieve carbon neutrality, improve resilience to greater weather extremes and support sustainable agriculture more generally. Stay tuned for upcoming blogs on Governor’s proposed investments on wildfire prevention efforts and an increase in the pesticide mill fee to support integrated pest management and alternatives to pesticides.

Climate Smart Agriculture Investments

The Governor proposed a $4.5 billion COVID-19 relief package for small businesses, schools and communities that he has asked the legislature to pass this spring. Included in that unusual spring budget proposal are a number of early action investments in Climate Smart Agriculture to support the Governor’s efforts to advance natural and working lands climate solutions as part of his Executive Order, announced last fall.  Here’s the breakdown:

Healthy Soils Program (CDFA):  $15 million proposed for the early action relief package plus $15 million for FY 2021-2022.  Total proposed $30 million.

State Water Efficiency Program (SWEEP, CDFA): $20 million proposed for the early action relief package plus $20 million for FY 2021-2022. Total proposed $40 million.

There is no funding in the Governor’s proposal for the Alternative Manure Management Program (AMMP, CDFA). Instead, the Governor proposes $50 million for a broadly defined “Catalyst Fund” that would provide low-interest loans for a variety of agriculture and climate related investments, including methane reduction.  We remain concerned that for many small and mid-scale dairy producers that loans will not offer enough of an incentive to do AMMP-like projects. Last year, dairy and livestock producers sought over $54 million in AMMP grant funding, far exceeding available funding.  Without continuing that program, the state will likely miss out on key methane reduction projects in the dairy and livestock sector.  The other methane reduction program, the Dairy Digester Development and Research Program is also zeroed out in the Governor’s proposal.

The Sustainable Agricultural Lands Conservation Program (SALCP) will continue to receive a continuous appropriation as part of the continuous appropriation of Greenhouse Gas Reduction Fund monies to the Strategic Growth Council, anticipated in FY 2021-22 in the $42 million range.

The Governor also proposes $170 million for the FARMER program which pays for farm equipment upgrades primarily the San Joaquin Valley.

Small Farmers, SGMA, Regulatory Relief

Governor Newsom includes a Sustainable Agriculture Chapter in his budget proposal, a first.  In addition to the Climate Smart Agriculture Programs, Governor proposes new Sustainable Agriculture funding, including the following:

Small and Mid-Size Farm Support:  $3.35 million in early action funds and $3.35 million in FY 2021-2022 to the University of California Cooperative Extension small farm advisors to provide technical assistance for “business planning, navigating regulatory compliance and accessing state and federal funds.”  This proposed funding comes after many years by CAFF and others who have supported additional funds for UCCE small farm advisors. Total proposed $6.7 million.

Sustainable Groundwater Management Act: $30 million in early action funds and $30 million in FY 2021-2022 to the Department of Water Resources for grants to support groundwater planning and implementation projects in critically over-drafted basins. Total proposed: $60 million.

Regulatory Relief:  $4 million in early action funds and $2 million in FY 2021-2022 to CDFA to evaluate and implement “the alignment of regulatory reporting activities across state agencies to reduce unnecessary burdens to farmers and ranchers in their efforts to meet regulatory compliance.”

You can read the full budget proposal, including the Sustainable Agriculture Chapter here.

Next Steps

We are pleased to see the ongoing investments in Healthy Soils and SWEEP and the number of the Sustainable Agriculture investments.  We will continue to support re-investment in the multi-benefit AMMP to support dairy and livestock producers to address methane emissions and related air and water quality issues.  And we will explore how COVID-19 response investments are addressing the needs of essential workers, like farmworkers, and those most vulnerable in our food and agriculture system.