HARRISBURG, PA — Agriculture Secretary Russell Redding is calling on Pennsylvania farmers to apply for $13 million in tax credits aimed at enhancing soil health and water quality. The tax credits are available through the state’s Resource Enhancement and Protection (REAP) program, a pioneering conservation financing initiative. Farmers can combine these credits with other state and federal funding to support environmentally beneficial farm enhancements.
“Pennsylvania farmers are investing heavily in cleaner water and productive soil to sustain us in the future,” Secretary Redding said. “Their investments, multiplied exponentially by support from Governor Josh Shapiro and the General Assembly, are paying dividends in the form of healthier waterways and a greener future for Pennsylvania farms and communities.”
The REAP program, managed by Pennsylvania’s State Conservation Commission, is now accepting applications from agricultural producers. Eligible projects include best management practices and equipment purchases designed to reduce nutrient and sediment runoff, enhance soil health, and improve water quality.
Governor Shapiro’s 2024-25 budget includes new investments in agricultural innovation and conservation. The budget allocates $10 million to the Agriculture Innovation Fund and $35 million to continue Clean Streams Fund support for the Agriculture Conservation Assistance Program (ACAP). An additional $5 million has been designated for the Nutrient Management fund.
Since January 2023, nearly $85 million from the American Rescue Plan has been directed towards ACAP, benefiting over 1,200 farmers in their conservation efforts. These state investments are magnified by federal funding, boosting the impact of conservation programs.
Pennsylvania farms have increased no-till acres by 2.3% since 2017, reaching nearly 1.65 million acres. Cover crop acreage has grown by 7.9%. These practices contribute to healthier waterways, improved soil, and reduced input costs for farmers.
REAP, currently in its sixth year of increased funding under the PA Farm Bill, offers farmers up to $250,000 in tax credits over seven years. Joint filers can also utilize these credits. Funded projects include no-till and precision agriculture equipment, waste storage facilities, conservation plans, and nutrient management plans. Projects that limit runoff from high animal-traffic areas, as well as cover crops and stream buffers, are also eligible for tax credits.
Farmers can receive REAP tax credits covering 50 to 75 percent of a project’s eligible costs. Those in watersheds with an EPA-mandated Total Maximum Daily Load (TMDL) can receive credits covering 90 percent of costs for certain projects. Applications are reviewed on a first-come, first-served basis, with baseline eligibility requiring compliance with the PA Clean Streams Law and the Pennsylvania Nutrient and Odor Management Law.
Private investors can participate in REAP by providing capital in exchange for tax credits, allowing farmers to access funds more quickly and boosting lender confidence. More than 80 businesses have participated, either by sponsoring BMP projects on farms or by purchasing REAP tax credits from farmers.
Since its inception in 2007, REAP has awarded over $155 million in tax credits for more than 8,500 projects on 4,000 farms. These efforts have prevented 6.5 million pounds of nitrogen, 350,000 pounds of phosphorus, and 350,000 tons of sediment from entering Pennsylvania waterways.
Farmers interested in applying for REAP tax credits can find more information through the State Conservation Commission.
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