This story was reported and written by our media partner VPM News.
A new state report found that the Virginia Agricultural Cost Share Program (VACS), which helps farmers pay for conservation and water quality practices, has grown in the past five years.
State funding for the program has gone up, more farmers are participating and more have installed pollution controls.
So why, then, has the percentage of unused state funding for the program also grown at the same time?
Auditors found that many agricultural producers in the commonwealth are still wary of joining the program, but a bigger problem might just be the lack of people available to do the actual work of installing pollution controls.
Meanwhile, a deadline looms — state law says if Virginia’s Phase III Watershed Implementation Plan goals are not met by 2028, some pollution controls in the program will become mandatory.
What is VACS?
Virginia’s pollution reduction goals under the Chesapeake Bay Agreement are generally split into two sources: point and nonpoint.
Point source pollution comes from one specific place — such as a wastewater treatment plant, discharges from an industrial facility, even leaks from a landfill. It is often expensive to deal with, but state, local and federal investments have made a significant impact on point source pollution. The state reduced nitrogen and phosphorus (both chemicals that harm water quality and aquatic life) emissions from wastewater treatment plants by more than 50% from 2007 to 2023.
It’s harder to get a handle on nonpoint sources — this covers an extremely wide range of human activities that are spread out. Agriculture is a major source of nonpoint source pollution, with fertilizers, pesticides and animal waste running off into streams, rivers and eventually the Chesapeake Bay.
The solution for decades has been to incentivize farmers to engage in best management practices, like fences or vegetated buffers to keep livestock out of streams, manure composting systems and groundcover crops on fields not actively in use can all reduce pollution runoff.
The General Assembly established the program as it exists today in 1984.
Virginia has a list of 64 of these practices. Farmers can claim up to $300,000 in state reimbursements for the improvement and can seek technical assistance from local soil and water conservation districts.
JLARC analyst Lauren Axselle said the commission found VACS is mostly effective and well run.
“VACS has grown substantially, which has reduced agricultural pollution according to our data and the federal Chesapeake Bay Program model,” Axselle told lawmakers.
But there are areas for improvement.
Funding concerns
Funding for VACS grew significantly under former Gov. Glenn Youngkin. His administration fully funded the program according to a state agricultural needs assessment, which estimates the needed funding to pay for enough best management practices to get the state to its WIP Phase III goals by 2028.
But not all of the funding has been used in the year it’s allocated, and the annual amount of unused funds grew during Youngkin’s term.
In fiscal year 2023, 30% of funds went unobligated — roughly $36.8 million. In FY26, it was 36% — roughly $79.3 million. (Virginia’s fiscal year runs July 1-June 30.)
Although the unobligated funds are returned to the program in the following fiscal year, Axselle said this represents an opportunity cost, as “they could have been used by other programs.”
The problem is that the agricultural needs assessment doesn’t necessarily account for what is doable, just what is needed to meet goals. Some soil and water districts have struggled to keep up with the projects that come with the additional funding, like installing fences and constructing farm buildings.
Axselle also noted that excess funds may not always be a problem.
The funding source for VACS — mostly general fund surpluses — may be unsustainable.
The state has made a habit of posting revenue surpluses since Gov. Ralph Northam’s term, with the exception of the fiscal year from July 1, 2019–June 30, 2020 (any guesses why?).
Fiscal 2026, which ended in June, was the same. Despite economic pressures from lost federal and contractor jobs, the commonwealth posted a near-$1 billion surplus for the fiscal year. But Spanberger urged caution in remarks to lawmakers in August, pointing to “chaos thrust upon Virginia” by DOGE and the Trump administration.
“The numbers are good this year overall, and that is a good thing,” Spanberger said. “But a good year one year is not necessarily a guarantee of a good one the next.”
JLARC analysts say the Cabinet-level natural and historic resources secretary should preemptively order an analysis of the cost-effectiveness of those management practices. It’s not needed now, when funding is plentiful, but could become essential if revenue surpluses cease to be a regular occurrence.