Cost-Sharing Incentives In The Gum Creek Watershed Agricultural Water Quality Pilot Project

Abstract

Analysis of farmers' attitudes and potential and predicted responses to cost-sharing incentives is key to prospective adoption of such a program on a wider scale. A pre-project survey of potential participants in the Gum Creek Watershed, and an economic evaluation of management alternatives found that voluntary participation improved with higher cost-sharing rates. However, nitrogen runoff leaching effects were limited. Biophysical simulation and mathematical programming indicate that profitenhancing changes in supplemental irrigation management cause little or no added impact on water quality. Decreasing the nitrogen applications from currently advised rates has limited abatement potential because it sharply decreases farmers' expected net returns and voluntary participation. This analytical framework provides critical decision-making information on the economic and environmental tradeoffs and burdens under variations of program implementation. The analytical framework can be applied to other agricultural areas for prospective pollution abatement policies with regard to the same or other agricultural practices.