FarmPolicy

October 22, 2014

House Ag Committee, Day Three

Categories: Farm Bill

The House Ag Committee issued a press release today, which stated that, “The House Agriculture Committee today passed a new Farm Bill that makes historic investments in conservation, nutrition and renewable energy while maintaining a strong safety net for America’s farmers and ranchers. Additionally, for the first time, the 2007 Farm Bill provides substantial funding for the fruit and vegetable industry.”

The release also included this summary, “Important highlights of the Farm Bill (H.R. 2419) include:

* Investing more than $1.6 billion in priorities to strengthen and support the fruit and vegetable industry in the United States. A new section for Horticulture and Organic Agriculture includes nutrition, research, pest management and trade promotion programs.
* Providing farmers participating in commodity programs with a choice between traditional price protection and new market-oriented revenue coverage payments.
* Strengthening payment limits to ensure that people making more than $1 million a year (adjusted gross income) can’t collect conservation and farm program payments and closing loopholes that allow people to avoid payment limits by receiving money through multiple business units.
* Rebalancing loan rates and target prices among commodities, achieving greater regional equity.
* Cutting federal payment rates to crop insurance companies that are making record profits due to higher crop prices.
* Extending and makes significant new investments in popular conservation programs, including the Conservation Reserve Program, Wetlands Reserve Program, Environmental Quality Incentive Program, Farm and Ranchland Protection Program, and many others.
* Expanding the USDA Snack Program, which helps schools provide healthy snacks to students during after-school activities to all 50 states and continuing the DOD Fresh Fruit and Vegetable Program, which provides a variety of fresh produce to schools.
* Strengthening and enhancing the food stamp program by reforming benefit rules to improve coverage of food costs and expand access to the program with additional funding support.
* Including key provisions that invest in rural communities nationwide, including economic development programs and access to broadband telecommunication services.
* Establishing a new National Agriculture Research Program Office to coordinate the programs and activities of USDA’s research agencies to minimize duplication and maximize coordination at all levels and creates a competitive grants program.
* Protecting and sustaining our nation’s forest resources.
* Making important new investments in renewable energy research, development and production in rural America.”

Concluding, the release stated that, “Copies of the bill considered by the Committee and the amendments that were adopted are available on the Committee’s website at: http://agriculture.house.gov/inside/2007FarmBill.html.

“The House of Representatives is expected to vote on the Farm Bill before the end of July.”

David M. Herszenhorn, writing in today’s New York Times, reported that, “The House Agriculture Committee on Thursday night approved a farm bill that would end federal subsidies for some of the nation’s wealthiest farmers but would otherwise extend existing payment programs for five years.

“The measure, acted on by a voice vote, stops well short of the wide-scale changes called for by critics of current policies.”

The Times article added that, “The bill had threatened to divide Democrats on the committee, many of them freshmen from swing districts where constituents favor the existing programs, from Democratic leaders who support cutting subsidies to increase spending in other areas like land conservation and nutrition programs, including food stamps.

“But changes to the bill this week, including the $1 million limit and the closing of a loophole that allowed some farmers to collect double the maximum limit on federal payments through partnerships in multiple farms, were greeted warmly by Speaker Nancy Pelosi of California and other leaders eager to avoid a potentially embarrassing fight.”

Noting reaction to the House vote, the article indicated that, “‘There is still much more to be done in terms of reform of the commodity programs,’ said Ralph E. Grossi, president of the American Farmland Trust, a nonprofit group that has lobbied for changes.

“Still, Mr. Grossi called the changes put forward by the Agriculture Committee ‘a positive step.’

“Other critics were not persuaded. ‘It looks like Democrats are poised to sell out on the payment limitation issue,’ said Ken Cook, president of the Environmental Working Group, a nonprofit research organization. ‘When you add it all up, not much changes. Not many dollars get saved.’”

However, Peter Shinn, writing yesterday at Brownfield, reported that, “South Dakota Representative Stephanie Herseth Sandlin (D) is defending the payment limits language adopted Wednesday during mark-up of the next farm bill by the House Agriculture Committee. Among other things, the language eliminates the three-entity rule and imposes more restrictive means tests on those receiving farm program payments.

“Some advocates for tighter farm program payments have expressed disappointment in the House approach. But according to Herseth Sandlin, those who say the proposed changes don’t represent serious reform have got it wrong.

“‘It’s unfortunate that those who have called for even more reform don’t acknowledge that we have accomplished some significant progress on payment limitations,’ Herseth Sandlin told Brownfield. ‘We were nowhere close to this even a couple of weeks ago.’”

Dow Jones writer Bill Tomson reported today that, “Committee Chairman Collin Peterson, D-Minn., said he expects a House floor vote on the farm bill later this month. If it is approved there, then it will eventually be merged with a Senate version. The Senate Agriculture Committee has not yet begun its debate on the farm bill.

“The House committee bill angered some – most notably cotton farm representatives – by excluding the wealthiest of farmers with an adjusted gross income of more that $1 million from receiving subsidies, but it also brought relief to sugar farmers worried about competing with imports. The House bill would assure that U.S. sugar farmers are guaranteed 85% of the domestic food market. It also raises the government floor prices for sugarcane and sugar beets.

“Another boon for farmers was the removal of a cap on marketing loan gains if prices drop steep enough for commodities such as wheat, corn, soybeans and cotton.”

Meanwhile, Congressional Quarterly writer Catharine Richert reported yesterday that, “A House committee’s overhaul of U.S. agriculture subsidies doesn’t go far enough, said four leading farm policy critics planning to fight the bill when it moves to the floor next week.

“The critics — Democrats Ron Kind of Wisconsin and Earl Blumenauer of Oregon and Republicans Jeff Flake of Arizona and Paul D. Ryan of Wisconsin — were revamping their strategy as the Agriculture Committee late Thursday approved a farm bill that bars the nation’s richest farmers from collecting government payments.”

Later the CQ article stated that, “Kind, Ryan and Blumenauer sit on the Ways and Means Committee, where they plan to press for farm bill savings. Peterson said earlier this week that Ways and Means would find offsets that would allow an extra $4 billion in farm bill spending. But without bigger cuts in farm subsidies, the trio of critics said they would press Chairman Charles B. Rangel, D-N.Y., to withhold the extra funding.

“‘We’re telling Rangel that we don’t have to do this,’ Ryan said.”

With respect to Rep. Kind’s Farm 21 proposal, Forum (North Dakota) writer Jon Knutson, reported yesterday that, “Proposed legislation to abolish the U.S. sugar program would hurt the nation and the Red River Valley, sugar industry leaders say.

“The Food and Agriculture Risk Management for the 21st Century Act, commonly known as FARM 21, was introduced this spring by several U.S. Congressmen.

“The legislation would make a number of changes to U.S. farm policy, including eliminating the U.S. sugar program.”

The article added that, “Minnesota last year led the nation in sugar beet production. North Dakota was second. Most of the two states’ beets are grown in the Red River Valley.

“Current sugar policies work just fine, said David Berg, president of Moorhead-based American Crystal Sugar.

“‘I ask people how much they pay for their gas and they always know,’ he said. ‘But they don’t know how much they pay for sugar. The point is, gas prices are high and volatile, while sugar prices are low and stable.’”

Dan Looker, writing yesterday at Agriculture Online, highlighted some of the conservation provisions that were included in the House bill.

Specifically, Mr. Looker noted that, “The House Agriculture Committee voted Wednesday to give farmers more credit for using multiple conservation practices when they sign up for the working lands program, the Conservation Security Program.

“And, they approved allowing farmers who are certified as organic to have their practices approved for the CSP signup process at the same time.

“Neither change adds money to the program, which under the latest House proposal wouldn’t be enrolling new applicants until 2009. But the sponsor of the amendment to the House farm bill, Representative Tim Waltz (D-MN) said it would treat more fairly farmers who practices controlled grazing, for example, as well as organic farmers.”

The article added that, “The committee delayed a proposal from Republican members to streamline several conservation programs and simplify the signup process, although chairman Collin Peterson said he was willing to work with the minority party to make some changes.”

On the issue of country of origin meat labeling, Associated Press writer Mary Clare Jalonick reported this morning that, “The House Agriculture Committee voted Thursday night to require country of origin labels on meats beginning next year, striking a compromise as reports of tainted food from China raise consumer awareness about imported food safety.

“After days of negotiations between both sides, the committee agreed to allow the mandatory labels but soften penalties and burdensome record-keeping requirements that had concerned many food retailers and meatpackers who opposed the law. The committee adopted by voice vote the labeling changes just before it approved a five-year farm law that would govern agriculture programs.

“The Agriculture Department never put in place the 2002 law requiring the labels because then-majority Republicans repeatedly delayed it, most recently to 2008.”

Michael Doyle, writing in today’s Sacramento Bee reported that, “The House Agriculture Committee early Thursday evening was poised to approve a farm bill that’s considered tastier than most by California growers.”

The Bee article indicated that, “‘This farm bill represents the first time in history that specialty crops have taken an equal seat at the table,’ said Rep. Dennis Cardoza, D-Atwater.

“Cardoza chairs the House horticulture and organic agriculture subcommittee. He took the lead in pushing for the increased funding.”

Philip Brasher, writing in today’s Des Moines Register, provided a nice summary article of farm bill “winners.”

Mr. Brasher stated that, “Some unconventional players in farm policy emerged on top as the House Agriculture Committee approved its version of the farm bill Thursday. But farmers fared well, too.

“The bill largely keeps the existing farm subsidy system enacted in 2002 largely intact. But lawmakers used some budget tricks to expand several conservation programs, including those that promote wildlife habitat, and targeted cuts to increase subsidies for many crops, including malt barley.

“Iowa corn and soybean farmers who were worried that their fixed annual payments might be cut are winners, too. Those payments, which total about $500 million a year in Iowa, are about the only type of crop subsidies that farmers are expected to get for the foreseeable future because of the sharp increases in corn and soybean prices brought on by the surge in demand for biofuels.

“Although there was talk early on of cutting the fixed payments to fund other programs, the payments are left intact in the legislation.

“As a result, the bill will have little effect on Iowa agriculture, said Bruce Babcock, director of Iowa State University’s Center for Agricultural and Rural Development.”

In other reaction to the House vote, Rep. Adrian Smith (R-NE) noted in a press release from yesterday that, “‘It has been a long and at times contentious process, but we are making progress. It is my hope both the House and the Senate can send a finished product we can all be proud of to the President before the current Farm Bill expires in September.

“‘I want the reauthorization of the Farm Bill to provide an economic safety net for agricultural producers. Unfortunately, this bill didn’t have everything I would have liked to see, but we will continue to work on this legislation for as long as we need to,’ Smith said.”

And, a press release from Representative Leonard Boswell (D-Iowa), Chairman of the Agriculture Subcommittee on Dairy, Livestock and Poultry, noted that, “‘This farm bill strengthens rural America while protecting our small family farmers,’ said Boswell. ‘It takes steps to modernize the dairy industry, strengthen the fruit and vegetable community and improve upon and increase enrollment in conservation programs.’

“‘We solved our differences by compromising and working together,’ added Boswell. ‘I especially want to commend Chairman Peterson for his leadership on moving the bill forward,’ added Boswell.”

With respect to funding issues and taxes, Reuters writer Charles Abbott reported yesterday that, “Agriculture Secretary Mike Johanns joined Republicans on the House Agriculture Committee on Thursday in opposing tax increases to pay for the new U.S. farm subsidy law.

“‘We don’t support tax increases. We don’t think that’s how this should be put together,’ Johanns told reporters after briefly participating in the committee’s bill-drafting session.

“While Johanns was present, Colorado Republican Marilyn Musgrave proposed ‘sense of Congress’ language saying tax increases should not be used to offset the farm bill. Chairman Collin Peterson ruled the amendment was not germane and said, ‘To me, it looks political.’

“‘As far as I know, there’s no tax increases being talked about,’ said Peterson, a Minnesota Democrat. He said offsets like $4 billion needed to expand public nutrition programs would come from collection of unpaid taxes and similar steps.

“‘If tax increases are utilized, you are going to lose a tremendous amount of support,’ said Virginia Rep. Bob Goodlatte, the Republican leader on the committee.”

Although much attention has focused on budgetary and funding issues as the Farm Bill process has developed, the “Washington Insider” section of DTN pointed out yesterday that WTO litigation and trade considerations may creep into the debate as well.

Specifically, “Washington Insider” (link requires subscription) noted that, “However, the WTO actions could be far from empty threats, trade experts suggest. For example, if the cotton panel rules, as expected, that the Unites States has not complied with its ruling, Brazil is likely to ask the WTO to apply large trade sanctions against U.S. intellectual property rights, most likely within the pharmaceutical sector, among others — with the expectation that those exporters are in a position to exert strong pressure on agricultural policy.

“‘The pharmaceutical lobby in the United States is 10 times the size of the cotton lobby,’ one Brazilian analyst suggested. ‘Let’s see what happens when Brazil asks the WTO in Geneva for the right to manufacture an HIV drug, without paying royalties to U.S. companies.’

“Thus, while congressional committees are struggling with budget issues and possible approaches to widen the appeal of farm bill drafts now being considered, the trade policy threat continues to build — a development that the committees may soon be unable to ignore.”

And with respect to executive branch perspective on the House Farm Bill vote, DTN’s Chris Clayton reported yesterday (link requires subscription) that, “It had been a mundane day of amendments on the farm bill Thursday afternoon until Secretary of Agriculture Mike Johanns appeared in the House Agriculture Committee room, shook hands with lawmakers and took a seat at a hearing table with USDA employees.

“Johanns sat at the table for less than a half hour, but it was the first time since at least the 1990 farm bill that anyone can remember the Agriculture Secretary sitting through part of the House markup. Johanns praised House Agriculture Committee Chairman Collin Peterson, D-Minn., regarding all of the USDA proposals that had made it into the House bill.”

Mr. Clayton added that, “When it comes to the House plan, Johanns said there are a lot of positive measures, but a lot of work is needed as well. A key issue, as always, is payment limits. The House proposes to cut off farmers from program payments at $1 million adjusted gross income, which is $800,000 more than the USDA proposed. Johanns said the AGI cap is a prime example of needed work.

“‘There are a number of areas where we would like to see more progress,’ Johanns said.”

For a full transcript of Sec. Johanns’ remarks with the press yesterday on Capitol Hill, just click here.

***

Reuters writer Missy Ryan reported yesterday that, “The U.S. government has shortchanged minority farmers, providing them with a fraction of the aid given to their white counterparts, Oxfam said in a report on Thursday, as the aid and advocacy group pushed Congress to craft legislation reversing decades of exclusion.

“Oxfam’s report showed that in 2002, the average African-American farmer in the United States received 37 percent of the aid that the average white farmer received.

“Only 18 percent of black farmers got any support at all, compared to 34 percent of white farmers, the group found.”

Keith Good

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