Financial Incentives for Land Restoration in the United States - Spring

Team Members: Mahak Agrawal, Anna Nikolova, Rashika Choudhary, Tunde Olatunji, Owen Flood, Drew Poling, Hayley Herzog, Rebecca Purba

Land degradation threatens ecosystem services, biodiversity, and economic productivity across the United States, yet restoration efforts remain constrained by fragmented policies and insufficient financial incentives. This project evaluated federal and state restoration policies to identify mechanisms that effectively encourage private landowners to undertake restoration activities. A comprehensive database of 60 policies across California, Colorado, and Maryland revealed that restoration incentives commonly take the form of direct payments, tax incentives, grants, cost-sharing programs, and technical assistance. However, policy implementation varies widely across states due to decentralized governance structures, resulting in uneven access to restoration funding and inconsistent program effectiveness. Federal programs provide broad funding support, but state-level policies often play a decisive role in implementation, shaping participation rates and restoration outcomes.

Financial incentives significantly influence landowner participation, but administrative complexity, inconsistent funding, and limited technical assistance reduce their effectiveness. Cost-share programs and direct payments were found to be the most impactful tools because they directly offset landowners’ financial risks, while tax incentives and credit systems were less effective due to uncertainty and delayed benefits. Restoration investments generate substantial economic and environmental returns, including improved soil health, water quality, and climate resilience. Expanding financial incentives, simplifying program access, and improving coordination between federal and state agencies would increase participation and accelerate restoration outcomes. Strengthening policy design and scaling successful incentive mechanisms can support broader ecosystem restoration goals and help achieve national climate and conservation targets.

Learn more about the MPA-ESP Capstone projects.