Swampbuster Wetland Conservation Requirements: Violations and Exemptions

The Swampbuster wetland conservation requirements in the Food Security Act cut off USDA program benefits for any producer who plants a crop on a wetland converted after December 23, 1985, or who converts a wetland after November 28, 1990, to make crop production possible. The lost benefits include commodity payments, conservation program funding, federal crop insurance premium subsidies, and Farm Service Agency loans, and they stay lost until the wetland is restored or the impact is mitigated. Because the ineligibility spreads to spouses, business partners, and affiliated entities, one wrong move on a single tract can pull down an entire family operation’s federal support.¹

What Counts as a Wetland

USDA uses a three-part definition. The land must have a predominance of hydric soils. It must be flooded or saturated by surface or groundwater often enough and long enough to support plants adapted to wet conditions. And under normal circumstances, it must actually support those plants.²

The Natural Resources Conservation Service checks those characteristics using published soil surveys, the National Wetland Plant List, and field observations during the growing season. When maps are not enough, NRCS may visit the site.³ One point trips up a lot of producers: “normal circumstances” refers to the soil and water conditions that would naturally exist. Clearing the vegetation off a wet field does not erase its wetland status if the hydrology and soils still qualify.

The Two Actions That Trigger a Violation

There are two separate violations, each with its own trigger date. The first applies to anyone who produces an agricultural commodity on a wetland converted after December 23, 1985. The second applies to anyone who converts a wetland after November 28, 1990, in a way that makes crop production possible.¹

Conversion covers draining, dredging, filling, leveling, or any other action that changes the wetland enough to permit farming.⁴ Installing new tile, regrading a field to redirect water, or clearing woody vegetation and stumps for planting all qualify. Even maintaining an existing drainage system can cross the line if it further impairs natural water flow.

The penalties differ. For producing a crop on a post-1985 converted wetland, the Secretary sets an ineligibility amount proportionate to the severity. For actually converting a wetland after November 28, 1990, the ineligibility applies for the crop year of the violation and every subsequent year until the wetland is restored or mitigated. FSA sets the specific reduction using technical information from NRCS.⁵

One boundary worth noting: Swampbuster is specifically about converting wetlands for commodity production. Putting a house or barn on a wetland may bring Clean Water Act requirements, but it does not by itself cause a Swampbuster violation.

Classifications That Change What You Can Do

Not every wet spot on a farm carries the same rules. NRCS assigns classifications, and knowing yours determines whether normal drainage work is fine or a costly mistake.

Prior-Converted Cropland

Land drained or otherwise converted before December 23, 1985, and used for crop production since then, gets a “prior-converted cropland” label. This is the most permissive status. You can farm it, and you can maintain or improve drainage, as long as the work does not alter the hydrology of nearby wetlands or bring new wetland acres into production.⁶

Farmed Wetland and Farmed-Wetland Pasture

A farmed wetland was manipulated and cropped at least once before December 23, 1985, but still floods enough during the growing season to meet certain thresholds. You can keep farming it as you did before that date, and you can maintain existing drainage. You cannot expand drainage beyond what existed on or before December 23, 1985, unless NRCS finds the additional effect on wetland values would be minimal. Farmed-wetland pasture works the same way for land managed for pasture or hay before the cutoff.⁶

Abandonment

Stop managing a farmed wetland or farmed-wetland pasture for five consecutive years and NRCS treats it as abandoned. It reverts to full wetland status and loses its exemption. If you inherit or buy land in these categories, confirm the management history before assuming you can keep doing what the previous operator did.⁶

Benefits You Lose for Noncompliance

The reach of a Swampbuster finding is wider than most producers expect. The regulations pull six categories of benefits:

Commodity programs, including Price Loss Coverage, Agriculture Risk Coverage, and marketing assistance loans under the Agricultural Act of 2014.
Conservation programs, including EQIP, CSP, CRP, and other programs under Subtitle D of the Food Security Act.
Federal crop insurance premium subsidies, which cover roughly 60 percent of total premium costs on average.⁷
FSA farm loans under the Consolidated Farm and Rural Development Act, if the proceeds would contribute to wetland conversion or erosion of highly erodible land.
Watershed protection payments under the Watershed Protection and Flood Prevention Act.
Payments under sections 401 and 402 of the Agricultural Credit Act of 1978.

⁸

Emergency disaster programs are not exempt. The Emergency Assistance for Livestock, Honeybees, and Farm-Raised Fish Program, the Livestock Indemnity Program, the Livestock Forage Disaster Program, and the Tree Assistance Program all require wetland conservation compliance.⁹ A drought or flood hitting after a violation can lock you out of the safety net just when you need it.

Crop Insurance Subsidies Follow Their Own Timeline

Federal premium assistance is only lost for reinsurance years after a final determination of violation, including the completion of all administrative appeals. It does not apply retroactively.¹

Timing of the conversion matters. For wetlands converted after February 7, 2014, the premium subsidy loss applies unless an exemption fits. For wetlands converted before that date, crop insurance premium ineligibility does not apply at all. And when the violation affects fewer than five acres on an entire farm, you can avoid the premium loss by paying a contribution equal to 150 percent of the estimated mitigation cost into a USDA wetland restoration fund.¹

Exemptions That Keep You Eligible

Swampbuster is not an absolute ban on all work near a wetland. Several exemptions let compliant producers continue operating.

Minimal Effect

When NRCS finds that a proposed activity would only minimally affect wetland functions, it can grant a minimal-effect exemption. Determinations are site-specific, so request one from your local NRCS office before starting any work that might touch a wetland.¹⁰

Mitigation

You can convert a wetland and still keep benefits if you replace the lost wetland values, acreage, and functions through restoration, enhancement, or creation of wetlands elsewhere. The mitigation must follow an NRCS-approved plan, happen in advance of or at the same time as the conversion, sit in the same general watershed, and be secured by a permanent easement to USDA on the mitigation site. The replacement ratio is at least one acre for each acre converted.¹¹ Farming before mitigation is complete opens a gap in eligibility.

When on-site work is impractical, credits from a wetland mitigation bank can offset the impact. Prices are negotiated between the buyer and bank operator; USDA sets no cost. State Conservationists can also designate certain wetland types as ineligible for the mitigation exemption when equivalent replacement is not realistic, meaning avoidance is the only compliant path for some high-value wetlands.¹²

Good Faith

A producer found in violation may regain eligibility if FSA determines the violation was unintentional and the producer is actively carrying out a mitigation plan within an agreed period of no more than one year. Good-faith findings need review by the State Executive Director with technical concurrence from the State Conservationist. FSA weighs whether site characteristics should have alerted you, whether NRCS had previously informed you, and whether you have a violation history. A first mistake on ambiguous ground reads very differently than a repeat offense after warnings.¹³

How the Penalty Reaches Spouses and Business Partners

An ineligibility finding does not stay with the person who committed the violation. It extends to “affiliated persons,” a defined category that can include family and business partners.¹⁴

For an individual producer, affiliated persons include a spouse and minor children, unless you can show the county committee that the spouse’s operation is maintained separately and independently. The category also includes any partnership, joint venture, or trust in which you or your spouse holds a direct ownership or financial interest. For corporations and partnerships, affiliated persons include participants and stockholders, but the rule carves out those with only an indirect interest through another entity and those holding 20 percent or less of a corporation’s shares.¹⁴

A proportionality limit softens the blow in one direction: when a penalty reaches an affiliated entity solely through the affiliation rules, the payment reduction is capped at the violating person’s interest in that entity. When the business itself is directly responsible, it faces a full loss. An anti-avoidance provision blocks ownership restructuring designed to escape the affiliated-person rule.¹⁴

Certifying Compliance on Form AD-1026

Every producer seeking USDA program benefits has to file Form AD-1026, the Highly Erodible Land Conservation and Wetland Conservation Certification, at the local FSA office. No AD-1026 on file, no benefits, and no premium subsidy on your crop insurance.¹⁵

The form asks whether you have produced or plan to produce crops on land that has not yet received a highly erodible land determination, and whether anyone has done drainage, leveling, filling, dredging, clearing, or excavation that NRCS has not evaluated since December 23, 1985. If either answer is yes, you list the farm and tract numbers, the activity, the current land use, and the county. Every person or entity with a legal interest in the operation signs.¹⁶

Affiliated persons with their own farming interests must file their own AD-1026 forms. A spouse operating a separate farm needs a separate certification. Update the form whenever you acquire new land or plan changes in drainage. False information on the certification can bring federal criminal penalties for making a false statement to a government agency.¹⁵

Getting and Appealing a Wetland Determination

After you file AD-1026, FSA forwards the file to NRCS for a technical determination. NRCS reviews soil surveys, aerial photos, and weather data, and often visits the site to check for hydric soils, water-tolerant plants, and evidence of saturation.

NRCS issues a preliminary technical determination first. You have 30 days to request reconsideration with a field visit or to request mediation. Do nothing in that window and the preliminary determination becomes final.¹⁷ Ask for reconsideration and the designated conservationist visits the site with you, gathers more information, and issues a reconsidered determination within 15 days of the visit. If the outcome is still adverse, the case moves to the State Conservationist for a final technical determination, which gets recorded on Form NRCS-CPA-026 with a boundary map.¹⁸

Keep the NRCS-CPA-026 with your permanent farm records. The determination stays valid as long as you continue agricultural use and conditions do not significantly change. New drainage work requires a new determination.

If you disagree with the State Conservationist’s final technical determination, you have 30 days to appeal to the USDA National Appeals Division. Requesting mediation in that window stops the clock, which restarts only if mediation fails. NAD assigns an Administrative Judge, holds a hearing within 45 days of a complete request (unless you waive the deadline), and issues a written decision within 30 days after the record closes. Either party can request a Director review, and after that a Director reconsideration within 10 calendar days. Deadlines falling on weekends or federal holidays roll to the next business day.¹⁹

The appeal matters because the boundaries NRCS draws control what you can farm. If a determination sweeps productive cropland into a wetland classification, the appeal is the mechanism to correct it before the financial consequences take hold.

1
Office of the Law Revision Counsel. 16 USC 3821 – Program Ineligibility
2
Office of the Law Revision Counsel. 16 USC 3801 – Definitions
3
eCFR. 7 CFR 12.31 – Wetland Identification Procedures
4
Environmental Protection Agency. CWA Section 404 and Swampbuster: Wetlands on Agricultural Lands
5
eCFR. 7 CFR 12.6 – Administration
6
eCFR. 7 CFR 12.33 – Use of Wetland and Converted Wetland
7
Congressional Budget Office. Reduce Subsidies in the Crop Insurance Program
8
eCFR. 7 CFR 12.4 – Determination of Ineligibility
9
eCFR. 7 CFR 1416.14 – Emergency Agricultural Disaster Assistance Programs
10
eCFR. 7 CFR 12.5 – Exemption
11
Natural Resources Conservation Service. USDA NRCS Farm Bill: Mitigation Exemption With Easement
12
Natural Resources Conservation Service. Wetland Mitigation Banking Program
13
eCFR. 7 CFR Part 12 – Highly Erodible Land Conservation and Wetland Conservation
14
eCFR. 7 CFR 12.8 – Affiliated Persons
15
U.S. Department of Agriculture. Form AD-1026 – Highly Erodible Land Conservation and Wetland Conservation Certification
16
USDA Farm Service Agency. Instructions for AD-1026
17
eCFR. 7 CFR Part 614 – NRCS Appeal Procedures
18
eCFR. 7 CFR 12.30 – NRCS Responsibilities Regarding Wetlands
19
U.S. Department of Agriculture. FAQs About NAD Appeals