Vermont farmers who are working to reduce phosphorus pollution from their fields into local water bodies will soon be eligible for a new kind of compensation.

Agriculture has long been recognized as the largest source of phosphorus pollution to Lake Champlain, and farmers, often financially strapped, have said that water quality work is expensive, time-consuming and sometimes out of reach.

A new program, run through Vermont’s Agency of Agriculture, Food and Markets, aims to compensate farmers for amounts of phosphorus pollution they can reduce that go beyond what’s expected through regulatory programs.

A grant from the United States Department of Agriculture’s Natural Resources Conservation District allocated $7 million to what’s called the “pay for performance” program, Vermont officials announced Jan. 10.

Over four years, the program will send $4.9 million in direct payments to farmers who successfully reduce phosphorus. A farm has to reduce 40% of its phosphorus before it can be eligible for the program, though farmers can get $15 per acre — up to $4,000 — for entering data from their practices.

After that initial reduction has taken place, a farmer could earn $100 per pound of phosphorus reduced, up to $50,000 per farm per year.

Ryan Patch, assistant director of the Agency of Agriculture’s water quality division, said he hopes that about 40 to 50 farms will enter their data, and the program plans to enroll between 20 and 30 farms.

Phosphorus exists in manure and fertilizer often used on farm fields, and rain and snowmelt can wash it into streams or lakes. In excess, phosphorus can cause blooms of cyanobacteria and algae, which can rob water bodies of the oxygen that plants and animals need to survive. Cyanobacteria, also known as blue-green algae, poses risks to human and animal health.

In Lake Champlain, phosphorus has caused cyanobacterial blooms that have prompted beach closures. The lake is loaded with too much of it, according to the 2016 Total Maximum Daily Load, a document that serves as a restoration plan for the lake. It outlines goals for the lake that the state is expected to meet by 2038.

In 2016, agriculture in Lake Champlain’s basin contributed about 40% of that phosphorus. Since that year, when the Environmental Protection Agency established the Total Maximum Daily Load, farmers have been responsible for more than 90% of the phosphorus reductions that have taken place.

The “pay for performance” program is one of the first of its kind in the United States, according to an announcement from the agency.

“We’re looking at some of those cumulative effects of planning — nutrient management, all of those practices — across every field across the whole farm,” Patch said.

In this case, the agency is using environmental modeling tools, calibrated to Vermont’s climate, that measure pollution reduction. When the Total Maximum Daily Load was created, the EPA modeled how much phosphorus ran off of farm fields and into water bodies.

Farmers would take data from their nutrient management plan — a document that guides their use of fertilizer and manure — and plug it into the modeling system. The program would use that modeling to compare the amount of phosphorus coming off of fields now.

“We compare those two values: What’s the base loading? What’s the current loading?” Patch said.

In 2020, management practices stopped around 25,000 pounds from entering local waterways, according to the most recent Clean Water Performance Report published in January 2021. Farmers have implemented management practices on more than 50,000 acres of agricultural land.

Recently, several environmental organizations sent a letter to the Agency of Agriculture asking it to implement stricter regulations for farmers. Experts expect climate change to increase the amount of precipitation and extreme weather in Vermont, which could increase the amount of runoff coming from farms, the letter said.

Elena Mihaly, vice president and director of Conservation Law Foundation Vermont, one of the organizations that spearheaded the letter, said the organization supports “the program’s design to only pay for voluntary stewardship that goes above and beyond farms’ regulatorily required levels of stewardship” under the Total Maximum Daily Load.

“We will be interested to see how many farms take advantage of the program,” Mihaly wrote in an email to VTDigger. “And I would underscore the importance of robust verification to ensure these funds actually bring about phosphorus reduction.”

Cornwall’s John Roberts, executive director of the Champlain Valley Farmer Coalition, said the organization recently sent an email to its 100 members encouraging them to apply for the program. The organization was created to help make farmers aware of their impact on water quality, he said.

“Paying for outcomes to actually demonstrate that farmer X is reducing above and beyond what the regulations would do — I think that is a tremendous benefit to the farmers,” he said.

Only hay and crop fields are eligible for this year’s applications to the program. Farmers must also have an up-to-date nutrient management plan and maintain good standing with state and federal requirements.

Farmers interested in applying can submit applications through the end of January. Get full details on the program online at agriculture.vermont.gov/VPFP.