This study focuses on development of agricultural best management practices (BMPs) for potato production areas in Northeast Florida, and presents the results of the initial situation assessment. BMP implementation is the primary strategy used by agencies and farmers to improve the efficiency and to ensure environmental sustainability of agricultural production. Although BMPs are defined as “economically feasible” and “cost-effective”, economic analysis conducted as a part of BMP development has been limited, leaving the room for disagreement about economic impacts of specific BMPs. As a part of the situation assessment, we used interviews, group discussions, a survey, and a field trip to collect information about farmers’ production practices and to examine farmers’ opinions about BMP development process. Then, partial budget analysis was used determine the relative impacts of various factors (including the implementation of nitrogen fertilization management BMP) on production returns. Finally, an economic model is proposed to incorporate production risk analysis in BMP evaluation process.