REAP Program to enhance Farm Production in Pennsylvania

Donor Name: Pennsylvania Department of Agriculture

State: Pennsylvania

County: All Counties

Type of Grant: Grant

Deadline: 10/31/2023

Size of the Grant: $250,000

Details:

Thirteen million dollars in REAP tax credits is available in FY 2023 to individuals and businesses that meet the eligibility requirements for the program. Guidelines for the program are established and administered by the State Conservation Commission. Eligible applicants receive 50%-90% of out-of-pocket project costs in the form of state tax credits. The amount of REAP credits available to an eligible applicant depends on the type of BMP implemented and the geographic location of the operation (for 90% tax credits).

Funding Information

An agricultural operation is eligible for a maximum of $250,000 of REAP tax credits in any consecutive 7-year period as calculated from the year in which the credit is issued.

Eligible Projects

• All REAP-eligible BMPs must be necessary to reduce pollution from nitrogen, phosphorus, or sediment runoff.
• Applicants may apply for proposed projects; or completed projects; or a mix of both. Proposed projects must be based on reasonable cost estimates and a current site Inventory and Evaluation (I&E) that has been developed by a person with appropriate NRCS job approval authority or equivalent experience/training. Applications for proposed projects must include an estimated timeline for completion.
• Projects are eligible for REAP tax credits for up to 3 years after the completion of the project (date of completion for constructed BMPs; date of purchase for equipment). REAP lifespans have been established by the Commission for all eligible BMPs. All projects must be maintained for their entire REAP lifespans.
• The Commission will consider applications for BMPs on existing agricultural operations. Projects involving an expansion of an agricultural operation by greater than 25% may be subject to a 50% reduction of REAP-eligible costs. All REAP applications that include manure storage, animal heavy use area protection, animal mortality facility, compost facility, or roofed BMPs must include a completed REAP Storage Facility and Animal Heavy Use Area Worksheet (p11 of the REAP application).
• Projects involving other public funding programs (i.e. EQIP, Chesapeake Bay, Growing Greener) are eligible to receive REAP credits. However, no tax credit will be provided for the publicly funded portion of a project.
• REAP tax credits are awarded at either 50%, 75%, or 90% of out-of-pocket costs. In general, high priority BMPs such as plan writing; or projects that treat runoff from animal concentration areas; are eligible for the 75% rate.
• Agricultural operations (and landowners) located within a watershed that has a written TMDL listing impairment from agricultural sources are eligible to receive REAP tax credits equal to 90% of out-of-pocket installation costs for a select list of BMPs. Projects completed after July 1, 2022 that meet the Commission’s requirements for the 90% credit rate will be considered eligible. The following BMPs are eligible for the 90% REAP tax credit on eligible operations:
• Riparian buffers greater than 50 ft in width.
• Multi-species Cover Crops
• Cover Crop roller/crimpers
• Stream crossings and livestock exclusion from streams. BMPs used in conjunction with stream crossings and livestock exclusion are also eligible for 90% REAP tax credit (e.g. Animal Trails & Walkways, Fence, and off-stream watering facilities)
• Soil Health Tests and Precision Variable Rate Nutrient Application Plans

Eligibility Criteria

To be eligible for REAP tax credits, an applicant must meet the following criteria:

• The applicant must be an individual or business who is subject to taxation by the Commonwealth of Pennsylvania under one of the following state taxes: Personal Income Tax, Corporate Net Income Tax, Capital Stock and Franchise Tax, Bank Shares Tax, Title Insurance Company Tax, Insurance Premiums Tax, and Mutual Thrift Institutions Tax.
• The agricultural operation must be in compliance with the PA Clean Streams Law. As such, the operation must have in place the following:
  • A current Agricultural E&S Plan for all acres operated by the applicant. The Plans must meet the requirements of the PA Clean Streams Law. The operation must be on-schedule for full implementation of the plan.
  • For operations that have animals or import manure: A current Nutrient Management Plan as required of the PA Clean Streams Law and Act 38; or a Manure Management Plan as required of the PA Clean Streams Law; for all acres operated by the applicant. The operation must be on-schedule for full implementation of the plan.
  • An agricultural operation with animal concentration areas (ACAs) on any portion of the operation must first implement all BMPs necessary to adequately treat nutrient, sediment, and storm water runoff from these areas. Any BMPs necessary to properly treat an ACA are eligible for REAP tax credits. If the operation has untreated ACA areas, the BMPs necessary to resolve the ACA pollution concern must be listed in the REAP application; and the BMPs must be fully implemented prior to receiving REAP tax credits for any other REAP-eligible BMPs.

For more information, visit PDA.