FarmPolicy

March 6, 2015

Update on the Iowa Ag Summit

In a two page article, with several helpful graphics, Donnelle Eller and Christopher Doering reported in Thursday’s Des Moines Register that, “Bruce Rastetter, the man behind the Iowa Agriculture Summit, is determined not to give away too much about the farm issues he will press potential presidential candidates to discuss Saturday in Des Moines.

“Undoubtedly, Rastetter will pepper the nation’s top Republican contenders about their support for ethanol and biodiesel. Biofuels are a political hot potato that either cuts our need for foreign oil and creates rural jobs or is unnecessary because of higher domestic production, depending on which expert you talk with.

But there’s a host of other issues the presidential aspirants must prepare for: free trade, immigration, conservation, biotechnology and food labeling, government subsidies, wind and solar power, and livestock production and animal welfare, Rastetter said.”


(Click here for large, full screen view).

The Register article indicated that, “Here’s a closer look at five top ag issues:

“1. Immigration

“The issue: Farm organizations say an overhaul is needed to protect undocumented agricultural workers, but it should come from Congress, not the White House. President Barack Obama tried to use his executive power to protect millions of undocumented immigrants from deportation last November, but it provided minimal relief to agriculture and has been overturned by a Texas judge. During the last Congress, the Senate passed a new immigration reform bill, but the Republican-led House failed to act.”


(Click here for large, full screen view).

Thursday’s article noted that, “2. Water quality

“The issue: Despite assurances otherwise from the EPA, agricultural groups contend the federal Waters of the U.S. rule would expand the ‘navigable waters’ protected by the Clean Water Act to include not only rivers and lakes but also ditches, stream beds and self-made ponds that carry water only when it rains. Farmers say they would face higher costs for environmental assessments and would need to apply for permits to allow them to till soil, apply fertilizer or engage in some conservation practices.”


(Click here for large, full screen view).

The article continued, and pointed to: “3. International trade

“The issue: Republicans and the White House have pledged to work together, and one indication of that sincerity could be trade. While much of the attention in recent months has fallen on Cuba, where Obama has proposed to normalize trade relations, a bigger boon to agriculture could come through the Trade Promotion Authority. The so-called fast-track authority, which expired in 2007, would allow Obama to negotiate trade deals, and submit them to Congress for a vote.”


(Click here for large, full screen view).

Next on the Register list: “4. Biotechnology & labeling

“The issue: If more states require labeling of foods made with genetically modified ingredients, Congress could be pressured to establish a uniform, nationwide law regulating the controversial technology found in much of the U.S. food supply.”

And lastly, Thursday’s article indicated that, “5. Ethanol mandate

“The issue: Lawmakers and oil trade groups led by the American Petroleum Institute are opposed to the Renewable Fuel Standard, a mandate that requires a certain amount of the largely corn-based fuel to be blended into the gasoline supply. They are pushing ahead to change or repeal the 8-year-old law popular with farmers and rural America. But change appears difficult. Many newly elected Republicans support the existing measure.”

Also in today’s Register, Kathie Obradovich stated in a column that, “Presidential candidates need to do more than just wear a seed-corn cap and get their eggs in the right baskets on farm issues to impress Iowa Secretary of Agriculture Bill Northey and other Iowa voters.

“‘I wouldn’t want somebody to just walk in and say, ‘I’m against California on eggs, I’m for RFS,’ and just check the boxes trying to get the positions right,’ Northey, a Republican, said. ‘They better explain why … and they should be able to fit that into their overall philosophy of government, if they’ve thought through those things.’

Ms. Obradovich added that, “What does hurt is if a candidate gets caught trying to pretend that playing Farmville on their phones somehow makes them the next John Deere. The gaffes stand out like Gucci loafers at the Iowa State Fair.”

Meanwhile, Geoff Earle reported on Wednesday at the New York Post Online that, ” Former Gov. George Pataki is about to join a throng of potential Republican presidential candidates appearing at high-profile speaking events in South Carolina and Iowa – and he’ll be emphasizing his down-on-the-farm roots.

“‘I’m from New York and I probably spent more of my life on a farm than anybody out there,’ Pataki told The Post, referring to rival Republicans, days before heading out to one GOP event, the Iowa Agriculture Summit.”

The Post update noted that, “Pataki grew up on a family Peekskill farm with ‘everything from corn to tomatoes starting with strawberries in the spring and running through apples and pumpkins in the fall.’ Now, he and his wife, Libby, run a farm that sells cherries, hay, and has 85 head of cattle.

“‘We’re doing grass-fed free range, hormone-free beef. I am not unaccustomed to getting my hands dirty on a farm,’ said Pataki, who also has a successful government consulting and legal practice.”

And Bloomberg writers Julie Bykowicz and Alan Bjerga reported on Thursday that, “The summit dovetails with efforts by Iowa Governor Terry Branstad, a Republican who is close to Rastetter, to start a grass-roots effort to make ethanol a central issue in the Iowa caucuses next January, traditionally the first vote of the presidential primary season. Earlier this year, Branstad announced the formation of a new group, America’s Renewable Future, which intends to mobilize a pro-ethanol army of 25,000 people from each party to participate in the caucuses. The group is backed by Growth Energy, the most active ethanol lobby, and headed by Branstad’s son Eric, who was Iowa field director for the 2004 Bush-Cheney campaign. He says he plans to open an office in each of Iowa’s 99 counties. ‘We can get our message into the coffee shops where the candidates are,’ Eric says. ‘Then we can use Iowa’s unique status to teach the rest of the country how important ethanol is.'”

Beth Reinhard reported on Thursday at The Wall Street Journal Online that, “For decades, presidential candidates have bowed to Iowa’s corn-based ethanol industry while campaigning in a state where corn is king.

But several of the likely Republican candidates slated to address the state’s agricultural industry on Saturday backed the sunset of ethanol subsidies in 2011, and many oppose the industry’s new sacred cow: the renewable-fuel standard, which requires blending ethanol and other biofuels into the gasoline supply.

“How the likely White House contenders navigate the issue will signal how much Republican politics are now driven by the party’s conservative base, which balks at government interference in the marketplace. Two GOP contenders who want to phase out the renewable-fuel standard, Florida Sen. Marco Rubio and Louisiana Gov. Bobby Jindal, are skipping the event.”

The Journal article added that, “Former Florida Gov. Jeb Bush, who is making his first trip to Iowa since flagging his White House ambitions, doesn’t appear to have publicly commented on the fuel standard, which was signed into law by his brother, former President George W. Bushf. However, the former Florida governor praised Republican presidential candidate Tim Pawlenty for ‘truth-telling’ when he advocating phasing out ethanol subsidies in 2011…Longstanding support among presidential candidates for Iowa’s agricultural interests began to crack in the 2008 campaign, when Republican Sen. John McCain opposed federal ethanol subsidies that totaled $6 billion a year.”

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Thursday Morning Update: Policy; Ag Economy; Trade; Regs; and, Political Notes

Policy Issues

A House Ag Committee news release yesterday stated that, “Today, Chairman of the Agriculture Committee K. Michael Conaway (TX-11), Nutrition Subcommittee Chairwoman Jackie Walorski (IN-2), and Livestock and Foreign Agriculture Subcommittee Chairman David Rouzer (NC-7) sent a letter to Agriculture Secretary Tom Vilsack and Health and Human Services Secretary Sylvia Burwell raising concerns about recommendations received from the Dietary Guidelines Advisory Committee (DGAC).

“‘Members of the Dietary Guidelines Advisory Committee greatly exceeded their scope in developing recommendations,’ Chairman Conaway said. ‘The Secretaries share responsibility for these flawed recommendations because they failed to keep the Committee focused on nutritional recommendations and away from areas such as sustainability and tax policy, which are outside of the Committee’s purview. At a time when consumers are already subjected to conflicting and often contradictory nutrition and health information, the dietary guidelines must provide the public with realistic, science-based recommendations. Given the grave concerns that have been raised, more time is needed for public comment, and those comments should be fully reviewed and considered.’”

Also yesterday, House Appropriations Subcommittee on Agriculture Chairman Robert Aderholt (R., Ala.) turned his attention to the Dietary Guidelines during a hearing where FDA Administrator, Dr. Margaret Hamburg, presented budget related testimony.

During the discussion portion of yesterday’s hearing, Chairman Aderholt noted that, “Let me switch over to dietary guidelines. The Department of Health & Human Services, and of course FDA is a part of that, has a lead role in developing the dietary guidelines for Americans in 2015. The Secretary of Agriculture appeared before this subcommittee, was sitting where you are sitting just about a week ago. He made a commitment to adhere to the statutory directive for developing the dietary guidelines for Americans. And as he put it, and this was his quote, “I know my role and I will color within the lines.”

Chairman Aderholt went on to ask Dr. Hamburg: “Can we get an assurance from the Department of Health & Human Services that the final report would include only nutrient and dietary recommendations and not include environmental factors and other extraneous material?”

A complete transcript of the exchange between Chairman Aderholt and Dr. Hamburg on the Dietary Guideline issues can be found in this update that was posted yesterday at FarmPolicy.com.

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Des Moines Register– Iowa Ag Summit, Sen. Grassley

Christopher Doering reported on the front page of the Business Section of today’s Des Moines Register that, “Presidential hopefuls have reached out to Sen. Chuck Grassley for advice on agricultural issues, a step the Iowa lawmaker said could shed light on a topic that has struggled to get national attention in past races.

“Grassley, who farms corn and soybeans with his son in Butler County, told reporters that two candidates have contacted him for his insight ahead of Saturday’s Iowa Agriculture Summit, which is expected to attract a dozen GOP presidential contenders. He wouldn’t name those who had reached out to him.

“‘The candidates are doing what they should not need an incentive (such as the ag summit) to do,’ Grassley said. ‘If I have to brief them, that means they need some more understanding of the ag issues. When only 2 percent of the people in this country are producing food, we need all the help we can get.'”

Mr. Doering pointed out that, “Grassley said agricultural issues have long failed to attract the attention ‘they ought to get’ during past presidential races. The six-term Iowa senator and member of the Agriculture Committee said he was hopeful the summit would boost the profile of agriculture in the caucuses and throughout the 2016 presidential election.

“Grassley said he told the two potential candidates about several agricultural issues, including the importance of trade to Iowa farmers and the drop in corn and soybean prices that has left some growers struggling to cover their cost of production. He said he reminded the candidates to be compassionate to producers when times get difficult.”

Also with respect to Saturday’s Summit, Jennifer Jacobs tweeted the following about Sen. Marco Rubio (R., Fla.) this morning:

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Wednesday Morning Update: Policy Issues; Ag Economy; Trade; Regs; and, Budget

Policy Issues

Yesterday, the House Appropriations Subcommittee on Agriculture heard testimony regarding the USDA’s Marketing and Regulatory Programs.

In his opening statement, Subcommittee Chairman Robert Aderholt (R., Ala.) indicated that, “USDA is requesting a total of $987 million in discretionary resources in FY 2016 for the mission area, a decrease of $12.5 million from the 2015 enacted level…I am particularly concerned that USDA has requested scarce discretionary resources for lower priorities. For example, APHIS has requested an increase to enhance implementation of the Lacey Act provisions. I have trouble supporting such an increase at the expense of higher priority and more effective animal and plant health programs, many of which the agency has proposed to decrease.

“With the overall spending caps still in effect, I anticipate that the Subcommittee’s funding levels will remain relatively flat at best.”

Ed Avalos, USDA Under Secretary for Marketing and Regulatory Programs noted yesterday that, “To strike the balance between rigorous scientific review and timely entry to the market of genetically engineered crops, USDA streamlined and improved the process for making determinations on petitions involving biotechnology. Because of the enhancements, we reduced the length of the petition review by more than 600 days when we can use the environmental assessment process. With this improvement, we estimate that the cumulative number of actions taken to deregulate biotechnology products based on a scientific determination will increase from a cumulative total of 87 actions in 2011 to an estimated 119 in 2016.”

This topic came up in the discussion portion of yesterday’s hearing; Chairman Aderholt inquired: “Last year you reported that you were only able to reduce the backlog of 22 petitions by six. Your testimony this year states that you are nearly through the list of backlogged petitions. Can you provide us some more details on the status of the backlog and what progress you’ve been able to achieve?”

Animal and Plant Health Inspection Service Administrator Kevin Shea offered more details, and explained that, “You might recall a year ago I pledged to you we would cut the backlog of 16 by at least half, and I’m proud to say that the fantastic men and women who work in our biotechnology review program have indeed exceeded that goal, and there now only six of those 16 remain, so that means we reduced it by more than half.

“I would say this also, when we began our business process improvement just a few years ago, 2012, there were 23 re-regulation requests in the backlog. Since then 11 [more] requests to come in, so there were a total of 34 regulation requests. There are only six left. We got 28 out of 34 done. There are only six remaining. We’re going to get those done, we think, by the end of this fiscal year.

And so now we have the system in equilibrium. We can handle the amount that come in. And not only can we handle them, we can handle them quicker. It was taking us three to five years to do these things. We are now down to 15 to 18 months. Our goal is no more than 15 months, and I think we’re going to achieve that as well.”

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Front Page of Tuesday’s Des Moines Register- Iowa Ag Summit

Jennifer Jacobs reported on the front page of Tuesday’s Des Moines Register that, “The debut of Jeb Bush on the Iowa presidential landscape is one factor that marks Saturday’s Iowa Agriculture Summit (@IowaAgSummit), as an important milestone of the early 2016 campaign.

“It’s also the first big multi-contender GOP presidential forum that will attract business Republicans who are more interested in economic issues than social issues or God’s place in the civic arena.

“A crush of national media will be in Des Moines to cover the ag summit, which will audition a dozen GOP presidential contenders over a seven-hour period in front of a sold-out audience of 900.”

Ms. Jacobs explained that, “The assemblage of potential presidential candidates will be bigger than Iowa’s previous cattle-call forums, including Bob Vander Plaats’ Family Leadership Summit in August, which attracted religious conservatives, and Steve King’s Iowa Freedom Summit, a January event that also drew heavily from the Christian conservative and tea party factions of the GOP.

“Another key difference at this event will be the format. Rather than giving speeches, each contender will do a 20-minute question-and-answer session with host Bruce Rastetter, an agribusiness leader and GOP power player with close ties to [Iowa Gov. Terry Branstad].”

Today’s Register article added that, “All eyes will be on Wisconsin Gov. Scott Walker and former Florida Gov. Jeb Bush.

“‘Scott Walker is the runaway front-runner right now (in Iowa), so by default has the most to lose,’ said Tim Albrecht, an Iowa Republican operative who will likely support Bush if he runs for president.”

Note that the Register has a web page devoted to the summit, which can be found here.

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Tuesday Morning Update: Policy Issues; Trade; Ag Economy; Biotech; and Budget

Policy Issues

In a speech yesterday at the 2015 National Anti-Hunger Policy Conference in Washington, D.C., Secretary of Agriculture Tom Vilsack discussed the SNAP program and announced “more than $27 million in grants to fund innovative projects designed help end childhood hunger.”

Also yesterday, at the School Nutrition Association’s 2015 Legislative Action Conference, a separate venue in Washington, D.C., Sen. John Hoeven (R., N.D.) announced “that he plans to introduce the Healthy School Meals Flexibility Act later this week or early next week. The legislation would provide permanent flexibility to school districts in complying with the U.S. Department of Agriculture’s new school nutrition requirements.”

Additional details on these federal nutrition policy issues from yesterday, and on Sec. Vilsack’s remarks regarding the SNAP program, can be found here, at FarmPolicy.com.

On Monday, USDA’s Economic Research Service (ERS) updated its monthly Amber Waves publication; the March edition contained two particularly interesting articles on nutrition related policy. The first looked at the number of school districts serving “local” food, while the second addressed the potential of restricting sweetened beverages purchases through the SNAP program- an especially timely article considering the House Ag Committee’s ongoing top-to-bottom overview of the program (Committee SNAP hearing summaries here and here).

A summary overview of the two ERS articles is available here.

Arthur Delaney reported yesterday at the Huffington Post that, “The Republican Party’s new point man on food stamps, Rep. Mike Conaway (R-Texas), insists that he doesn’t want to cut nutrition assistance benefits. Instead, Conaway is leading a multiyear review of the program, just to make sure it’s the best it can be.

But it might not be up to Conaway. Republicans could push food stamp cuts this year through a parliamentary process known as ‘reconciliation.’

“The GOP has discussed using reconciliation as a way to repeal Obamacare or to do tax reform. Now, some Democrats and food stamp advocates are warning that the Republican-controlled Congress could use the obscure budget maneuver to reduce food stamp assistance.”

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USDA- ERS Amber Waves Nutriton Articles: Local Food Purchases; Potential SNAP Restrictions

Categories: Farm Bill /Nutrition

On Monday, USDA’s Economic Research Service (ERS) updated its monthly Amber Waves publication; the March edition contained two particularly interesting articles on nutrition related policy.

The first, which took a closer look at local food purchases made by school districts (“Many U.S. School Districts Serve Local Foods”), indicated that, “The Healthy Hunger-Free Kids Act of 2010 established the USDA Farm to School Program to encourage school districts to use locally produced food for meals served through the National School Lunch and School Breakfast Programs. USDA’s Food and Nutrition Service (FNS)—the agency responsible for administering school meal programs—partnered with ERS to conduct USDA’s Farm to School Census, the first attempt to ask every public school district in the United States about their involvement in farm to school activities and how much locally produced food they served in school meals. Schools reported how they defined ‘local foods,’ with two common definitions being foods produced within 50 miles or within the State. According to the census, 36 percent of U.S. school districts reported serving locally produced food in school meal programs during the 2011-12 or 2012-13 school years and an additional 9 percent planned to serve local foods in the future.”

The article added that, “The top food categories sourced locally were fruits and vegetables, cited by 94 and 91 percent, respectively, of the school districts that served local foods. Milk (45 percent), baked goods (27 percent), and other types of dairy products (22 percent) were also among the top food categories sourced locally. For districts that were able to provide food service expenditure data, local foods represented an average of 13 percent of reported expenditures on food.”

A separate Amber Waves item from Monday, which addressed the purchase of unhealthy items through the SNAP program (“Restricting Sugar-Sweetened Beverages From SNAP Purchases Not Likely To Lower Consumption”) stated that, “Americans now get an average of nearly 21 percent of their daily calories from beverages, up from 12 percent in 1965. Since calories from beverages may be less satiating than calories from food, consumers may not recognize how many calories they are consuming from beverages, potentially leading to higher total caloric intake. While some beverages—such as milk and 100-percent fruit and vegetable juices—provide important nutrients such as calcium and vitamin C, sugar-sweetened beverages (SSBs) provide few (if any) essential nutrients. As a result, some argue that SSBs have had a super-sized role in contributing to obesity in the United States.”

The article noted that, “Some policymakers and nutrition advocates have suggested that changes to SNAP, such as excluding SSBs from the set of allowable items that can be purchased using benefits, could directly address overconsumption of SSBs among low-income populations who receive program benefits…Underlying the argument to limit SNAP participants’ SSB purchases is the idea that SNAP participants consume more SSBs than nonparticipants, and that the SNAP benefit covers all of a household’s food spending so that any restrictions on purchases will have a direct effect on consumption in SNAP households.”

The ERS article included this graph:

However, the ERS update pointed out that, “Simply comparing average beverage intake across different SNAP participant and nonparticipant groups does not address the question of whether SNAP influences purchases and if restrictions on SNAP purchases will have any impact on individual intakes. Differences in the characteristics among the three lower income groups may explain differences in SSB and other beverage consumption…After accounting for these observable characteristics, SNAP participants are no more likely to consume SSBs than lower income nonparticipants. These findings are consistent with other ERS research on overall diet quality, which also found that SNAP participants’ diets do not differ greatly relative to otherwise similar nonparticipants. Along these lines, researchers in this analysis found no differences in alcohol consumption between SNAP and nonparticipating adults, even though alcoholic beverages cannot be purchased with SNAP benefits.”

The Amber Waves article also noted that, “On average, SNAP households received $257 from SNAP yet spent $490 on food each month. Over 85 percent of SNAP participants spent more than their monthly SNAP benefit level on food, purchasing an average of an additional $301 worth of groceries with their own money.”

With respect to implications of potential SNAP beverage restrictions, ERS explained that, “While SNAP participants could use their own resources to purchase SSBs, a restriction on SNAP purchases of SSBs would mean a slightly higher price of such beverages for participants in States that tax grocery store food purchases, since SNAP participants do not pay sales tax on SNAP purchases. Excluding SSBs from the allowable foods and beverages may mean SNAP participants who purchase them would have to pay the tax (State policies on how to tax mixed purchases—e.g., purchases using both SNAP and cash income—vary), effectively increasing the price of SSBs for SNAP participants and potentially lowering the quantity purchased. A previous ERS study estimated that a 20-percent tax-induced price increase on sweetened beverages would decrease total daily beverage intake a small amount—37 calories—for the average adult because SSBs make up a very small portion of household food budgets and consumers can substitute to nontaxed food or beverages that may contain added sugars and calories.”

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Federal Nutrition Issues, SNAP– Sec. Vilsack Remarks

Christopher Doering reported on Monday at The Des Moines Register Online that, “The food stamp program is being unfairly targeted by Republican lawmakers despite evidence it helps children, the elderly and other Americans, Agriculture Secretary Tom Vilsack said Monday.

“Vilsack, speaking before anti-hunger group Food Research and Action Center, said the Supplemental Nutrition Assistance Program helps lower poverty rates and improves childhood health and education. He rebuffed critics who said the program is fraught with abuse and fraud, noting that the SNAP error rate is among the lowest in government and its fraud rate is only 1 percent.

“‘Why is it that (lawmakers) are picking on the SNAP program? Because it works,’ Vilsack said. ‘If these people were really serious about reducing SNAP and helping folks why wouldn’t they consider raising the minimum wages?‘”

Mr. Doering added that, “Last week, the House Agriculture Committee held a hearing to review SNAP and explore how to improve the program.

“‘While the economy has changed and other welfare programs have adjusted to meet changing needs, it does not appear that SNAP has,’ said Rep. Mike Conaway, a Texas Republican who chairs the House Agriculture Committee. ‘I believe there is a role for SNAP, but we need to have a complete and clear understanding of its mission and purpose.'”

Arthur Delaney reported today at The Huffington Post Online that, “Vilsack said food insecurity and childhood hunger remain problems, with 15.8 million children living in households that struggled to afford food at some point in 2013.

“‘I don’t think there’s any understanding or appreciation of the depth of child poverty in many rural areas in this country,’ Vilsack said.”

A news release from USDA today stated that, “In a speech at the 2015 National Anti-Hunger Policy Conference today about the extent of childhood hunger in America and the impact of USDA programs on reducing food insecurity, Agriculture Secretary Tom Vilsack announced more than $27 million in grants to fund innovative projects designed help end childhood hunger. The announcement was part of USDA efforts during National Nutrition Month to focus on poverty and food insecurity among children, especially in rural areas. These projects will be tested in Kentucky, Nevada, and Virginia, as well as the Chickasaw and Navajo tribal nations.”

Bob Aiken, the chief executive officer of Feeding America, and Jim Weill, the president of the Food Research and Action Center, noted in a column on Monday at The Hill Online that, “The federal nutrition programs are examples of public policy at its best and have a long history of holding the line against the most devastating impacts of poverty and hunger. Investing in ending hunger is not just the right thing to do, it is the smart thing to do with a large return on investment. Hunger increases illness and health care costs, lowers worker productivity, harms children’s development, and diminishes children’s educational achievement. Were it not for the Supplemental Nutrition Assistance Program (SNAP), schools meals, afterschool and child care food, senior meals, WIC, commodity programs and other safety net programs, hunger and its impacts in our nation would be far worse.”

Aiken and Weill added that, “First, Congress must make hunger a priority in our nation’s budget and maintain its historic bipartisan commitment to protecting the structure and funding of programs that provide food assistance to vulnerable low-income households.

“And it must build on success with adequate funding and positive policy initiatives for the programs that help feed our children in the upcoming Child Nutrition Reauthorization, which includes school, after school, child care, and summer meals.”

A recent update at the Center on Budget and Policy Priorities indicated that, “The Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps) is the nation’s most important anti-hunger program, reaching nearly 47 million people nationwide in 2013 alone. These fact sheets provide state-by-state data on who participates in the SNAP program, the benefits they receive, and SNAP’s role in strengthening the economy.”

Meanwhile, an update on Monday at the USDA Blog by Kevin Concannon, USDA Undersecretary for Food, Nutrition, and Consumer Services, stated that, “We all want our children to succeed. It’s an important value and one the entire country can rally around. This March we’re redoubling our efforts to that commitment by celebrating National Nutrition Month and the importance of raising a healthier generation of kids.”

Undersecretary Concannon also addressed the Food Research and Action Center policy conference today.

Also today, Lydia Wheeler reported at The Hill Online that, “Sen. John Hoeven (R-N.D.) is introducing legislation to relax the rules for healthy school lunches.

“At the School Nutrition Association’s (SNA) 2015 Legislative Action Conference at the JW Marriott Monday, Hoeven announced the Healthy School Meals Flexibility Act to give schools more flexibility in complying with the U.S. Department of Agriculture (USDA) regulations when it comes to whole grains and sodium levels.”

The Hill update added that, “The bill would allow schools to revert back to 2012 standards, which require at least half of all grains served in school breakfast and school lunch to be whole grain rich. The standard now is for 100 percent of all grains offered to be whole grain rich.

The bill also prevents USDA from requiring further sodium reductions in school meals below the current level, which took effect July 2014.”

Keith Good

Sunday Afternoon Update: Policy Issues; Trade; Ag Economy; Biotech; and Regulations

Policy Issues

A news release on Friday from USDA’s Farm Service Agency stated that, “Agriculture Secretary Tom Vilsack announced today that a one-time extension will be provided to producers for the new safety-net programs established by the 2014 Farm Bill, known as Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC). The final day to update yield history or reallocate base acres has been extended one additional month, from Feb. 27, 2015 until March 31, 2015. The final day for farm owners and producers to choose ARC or PLC coverage also remains March 31, 2015.”

Also on Friday, Senate Ag Committee Chairman Pat Roberts (R., Kan.) stated that, “‘USDA heard the concerns directly from producers earlier this week at our first Committee hearing and took action as a result,’ Chairman Roberts said. ‘I would encourage all producers to visit their local FSA office as soon as possible to make sure they have enough time and information to make these important decisions.’”

Reuters writer Christine Stebbins reported on Friday that, “Crop insurance price guarantees for U.S. corn, soybeans and spring wheat in 2015 will fall 10 percent or more based on futures settlement prices for February, grain analysts said on Friday.

“The U.S. Department of Agriculture’s (USDA) Risk Management Agency (RMA), which oversees the multibillion-dollar crop insurance program, by law uses the average price in February for harvest-time grain futures contracts to set the ‘floor’ price that private insurers must guarantee farmers who sign up…[B]ased on Friday’s futures closes, the RMA is expected to set the floor price for corn at $4.15 a bushel, down 10 percent from last year’s $4.62, and for soybeans at $9.73 a bushel, down 14 percent from last year’s $11.36.”

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Highlights: House Appropriations Subcommittee on Agriculture- Budget Hearing, NRCS Chief

On Friday, the House Appropriations Subcommittee on Agriculture held a budget hearing and heard testimony from USDA- Natural Resources Conservation Service (NRCS) Chief Jason Weller.

In his opening statement at Friday’s hearing, Subcommittee Chairman Robert Aderholt (R., Ala.) indicated that, “We convene today to review NRCS’s fiscal year 2016 budget request. NRCS requests a total of $1.031 billion in discretionary funding for its salaries, expenses, programs, and activities. In addition, about $3.2 billion will be available through the farm bill’s mandatory conservation programs to farmers, ranchers, and private forest landowners to help them preserve, protect, and enhance their land.”

During the discussion portion of the hearing, Rep. Sanford Bishop (D., Ga.) brought up the issue of NRCS using drones in its remote sensing work- here is the exchange with Chief Well on this issue.

Rep. Sanford Bishop: Can you tell us if you have any plans to utilize drones to assist in the collection of information, because you do a lot of photography, put a lot of contracts out to take pictures, and there’s a tremendous amount of interest in the use of drones in agriculture, particularly in assisting the optimal design and layout of fields for water assessments and other related issues.

“Have you looked at this issue? Are there any current interagency discussions with FAA or other agencies concerning the growth in the use of drones? Obviously there are some security issues involved, but there’s also a great deal of interest for commercializing that practice and using it in agriculture.”

Mr. Jason Weller: “Absolutely. It’s a new technology, but we also have to be careful because folks do have privacy concerns. The FAA also had safety concerns. So in part NRCS, we sort of said full stop, let’s wait for FAA to actually come out with a rule.

Now that the rule has been issued, we’re trying to figure out how the NRCS can work within that to do remote sensing, but in a way that protects privacy, assure landowners who are not there there’s a regulatory component, because I know folks have some concerns when the federal government starts flying drones over their property. So we just need to make sure NRCS is doing this technology in a way that’s appropriate, that’s sensitive to landowners’ concerns, but also then helps us do a better job of managing resources.”

Also at the hearing, Rep. David Young (R., Iowa) wanted more information about NRCS wetland determinations and the farmer’s ability to appeal these decisions.

Rep. David Young: “Last year the NRCS proposed updating the way it conducts wetlands determinations in the prairie pothole states, you know, Minnesota, Iowa, North Dakota, South Dakota. How will the wetland determination proposal affect producers, and when there is a review, will there be an ability for folks to have a second request for review and a second opinion if they disagree with the determination you make?”

Mr. Weller: “Yes. So first starting with what a producer hopefully will experience with us. What we’re proposing is bringing a modern, up-to-date, scientifically driven approach to doing what we’re calling off site determinations. This is a practice we’ve had at NRCS for decades. But what we didn’t have in the prairie pothole region is a consistent approach across all four states. So depending on where your property was, you had a different approach that we needed to update.

“So what this means, though, is actually, at the end of the day, when we implement this—because we were just seeking comments on this approach so far—is better service for a producer. So right now, as you know, there’s been a backlog, particularly in North and South Dakota, but Iowa as well. And in a lot of cases it’s because it’s on site determinations. It takes staff time. When you do an off site determination, you’re using remote sensing technology, you know, photography, LIDAR coverage, other techniques to really do equivalent, if not a more accurate determination approach.

The bottom line is time savings. So the average number of times it takes to do an off site determination is six hours. The average number of hours it takes to do on site is at least 14 hours. Many of them are 40 hours. And that doesn’t count all the driving time. When you break that down in dollars and cents, if you just say, take—you assume 30 bucks an hour for like a field technician to go out and do it, that equates to about 170 bucks to do an off site determination. When you do on site it’s like over $400 a determination, on average.

But when you multiply that over like South Dakota, where they have 2,500 determinations in the backlog, that’s the difference between $300,000 over a million dollars. And when it comes down to that kind of expenditure, when you add that up across four states, you’re talking real money. And that’s money I’d rather employ back in the field to provide, you know, technical assistance to producers as opposed to investing it in a way that we can be more efficient.

“So to your question about what happens for the producer, the first approach would be the off site determinations, which will be much more efficient. They’ll get determinations made quicker. It’s a preliminary determination. If they don’t like the determination, they can then appeal it and they can then request an on site determination.

“If they don’t like the on site determination from the field staff, they can then appeal that to the state office. If they don’t like the state office determination, they can then appeal that to the national appeals division. So there’s absolutely all these protections for a producer. We’re not changing any of that, how that works. We’re actually just trying to streamline it and get the determinations made faster and cheaper.”

And a third key issue discussed at Friday’s Appropriations Committee hearing was on the Regional Conservation Partnership Program.

Chief Weller noted that, “It’s the Regional Conservation Partnership Program, which is a new authority in the 2014 Farm Bill. The basic idea here is you actually invite local partners to devise their own projects. You ask them what do they want to do. So what we’re finding is that more often than not you go into places like the Salinas Valley or the [Pajaro] Valley, in your district, for example, and there’s a lot of people doing a lot of really good things, but more often than not we’re not coordinated. We’re putting a lot of money in the ground, but in a way we’re like ships passing in the night.

“So what we did at the Regional Conservation Partnership Program, it’s sort of like pulling a sock inside out. Instead of the federal government saying this is what we’re going to do in your community, instead we asked the community what do you want to do, and then we’re here to support you. So we opened it up to competition, and we got applications, 600 applications from every state in the country, from all over the country, and folks were really excited about this.

“And what it does is it catalyzes that locally led approach where you get like the Santa Cruz RCD. They then talk to Driscoll’s Berries, they talk to the Pajaro Valley Water Management Agency, they talk to Santa Cruz extension, they talk to the marine sanctuary, and they leverage the resources upfront, and then they come to us and they say NRCS, this is what we would like to do with the EQIP program in the Pajaro Valley to save water, but also to increase ground water recharge.

“And so one of the projects we funded then in the Pajaro Valley this year through our first round was $800,000 of NRCS money matched by $900,000 of the partners, so a total project over one and a half million dollars that they estimate is going to save over 400 acre feet of withdrawal from the aquifer, but also add additional recharge aquifer of 600 acre feet. That is a lot of water savings in a water scarce area.

“But you’re getting industry involved, Driscoll’s Berries; you’re getting extension to provide really good outreach and education; you’re engaging RCD, so it’s a locally led approach; and the federal government then is just a co-investor, we’re a true partner in this. So this is one example. Nationally we have 115 of these projects that they’re just showing this is an approach we really absolutely have to pursue.”

Keith Good

Friday Morning Update: Policy; Trade; Ag Economy; Biofuels; Biotech; and, Budget

Policy Issues

On Thursday, the House Agriculture Nutrition Subcommittee met, “to review SNAP recipient characteristics and dynamics.” Yesterday’s hearing followed Wednesday’s full House Ag Committee meeting on SNAP and nutrition issues.

A FarmPolicy.com summary and overview of Thursday’s Subcommittee hearing is available here.

Over the past two days, the House Ag Committee has been presented with a large amount of detailed analysis and information on SNAP; it appears that Chairman Mike Conaway’s (R., Tex.) top-to-bottom review of the program is off to a substantive and serious start.

In remarks on the House floor Thursday, Ag Nutrition Subcommittee ranking member Jim McGovern (D., Mass.) indicated that, “Mr. Speaker, yesterday the House Agriculture Committee – where I am proud to serve – held the first hearing in its ‘top-to-bottom’ review of the Supplemental Nutrition Assistance Program, or SNAP.

“SNAP is the nation’s pre-eminent anti-hunger program that provides critical food assistance to more than 46 million Americans. Last year, 16 million children – or 1 in 5 American children – relied on SNAP. Unfortunately, every indication is that Republicans will once again try to cut this critical safety-net program.”

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House Ag Nutrition Subcommittee Hearing on SNAP

Categories: Farm Bill /Nutrition

On Thursday afternoon, the House Agriculture Nutrition Subcommittee held a hearing, “to review SNAP recipient characteristics and dynamics.”

On Wednesday, the full Committee heard background testimony from two experts on the SNAP program.

In her opening statement on Thursday, Subcommittee Chairwoman Jackie Walorski (R., Ind.) indicated that, “The full committee yesterday examined why a review of SNAP is so important – it’s the largest welfare program in both the number of recipients and the amount of spending, yet the program lacks a clear mission and the data reveals that it is not helping lift people out of poverty. It is my hope and expectation that this subcommittee, along with the work done at the full committee, will explore and gain a better understanding of the entire program and specifically its recipients to find unmet needs and areas of overlap.”

Chairwoman Walorski added that, “Today is not about policy recommendations; it’s about understanding the diverse characteristics and dynamics of the more than 46 million Americans who receive benefits from this program each month. Over the coming months, our review will include a range of stakeholder perspectives, including current and former recipients; non-profits, states and localities, the food industry, and nutrition experts to name a few.”

Subcommitte ranking member Jim McGovern (D., Mass.) noted in his opening remarks that, “As I said at yesterday’s hearing, I’m a little surprised that we’re starting the first ‘top-to-bottom’ review of programs within this Committee’s jurisdiction with SNAP, a program whose caseloads and spending are going down according to CBO. I hope we exercise the same rigorous oversight on farm subsidies to big agribusiness – payments that CBO projections indicate could end up costing nearly $5 billion more than expected in the farm bill.”

Ranking member McGovern added that, “I hope today’s hearing builds upon some of the overarching themes that came up yesterday. In particular, we need to address one the biggest flaws in our social safety net, the so-called ‘cliff.’ This happens when someone gets a job but earns so little they lose their benefits and end up worse off. And, if we really want to move people out of poverty for good, we need to raise the minimum wage.”

The Subcommittee heard testimony from only one panel that included: Karen Cunnyngham, a Senior Researcher at Mathematica Policy Research, Dr. Gregory Mills a Senior Fellow at the Urban Institute, Dr. James P. Ziliak from the University of Kentucky and Stephen Tordella, the president of Decision Demographics.

In her prepared testimony, Karen Cunnyngham indicated that, “In fiscal year 2013, 41 percent of SNAP households received the maximum benefit and 5 percent received the minimum benefit. The average monthly SNAP benefit was $271. SNAP households with children received a relatively high average benefit of $410, while households with elderly individuals received a relatively low one of $134. One reason for the difference in average benefits is the difference in average household size: 3.2 people for SNAP households with children, compared with 1.3 people for households with elderly individuals. SNAP households that include a nonelderly adult with a disability had an average monthly SNAP benefit of $204 and households with no elderly individuals, individuals with disabilities, or children had an average benefit of $195.”

Dr. Gregory Mills noted in his prepared remarks yesterday that, “This study examines the rates, causes, and costs of participant churn in SNAP. Churn occurs when a household receiving SNAP exits the program and then re-enters within four months or less, as defined by FNS for this research. Some churn is to be expected—as when a temporary increase in earnings makes a family briefly ineligible for assistance. Churn presents a policy concern, however, when benefits are disrupted for households who were continuously eligible. In these situations families lose benefits while off the program, with added time and expense involved in re-entering. Budgetarily, the pattern of case closings and reopenings brings higher State and federal administrative costs. Importantly, about half of the households who churn are families with children whose food security is placed at risk.”

Dr. James P. Ziliak stated in his prepared testimony that, “The past decade of near uninterrupted growth in participation is unprecedented in the program’s history. By most measures the recession of 2001 was mild, and with declining unemployment in the aftermath of the recession, past experience would have dictated a decline in participation in the mid 2000s. This did not happen. Participation then accelerated with the onset of the Great Recession as millions of Americans lost work.”

Dr. Ziliak added that, “[T]he fraction of SNAP households headed by a high school dropout has plummeted by more than half since 1980, and by 2011, more than a third of SNAP households were headed by someone with some college or more.”

In his prepared remarks, Stephen Tordella noted that, “The most common events associated with entry into SNAP were related to decreases in family earnings, loss of employment, and changes to the family situation. Among those who entered SNAP in the study period, 30 percent experienced a substantial decrease in family earnings in the previous four months, while 23 percent experienced a substantial loss in other family income—income aside from earnings and Temporary Assistance for Needy Families (TANF). Nearly 16 percent of those who entered SNAP were in families where a member became unemployed within the previous four months, and 12 percent experienced a change in their family situation within the previous four months, such as a pregnancy, a new dependent in the family, or a separation or divorce.”

On the other hand, Mr. Tordella noted that, “In about 30 percent of households that exit SNAP, the data do not show an event related to improved financial circumstances or reduced need in the previous four months that we would readily associate with exit from the program. About 70 percent experienced a substantial increase in income or a decrease in the number of family members. Thirty-seven percent experienced more than one of these events in the four months before exiting. Increases in earnings were the most common of the events we examined that preceded exits. These events, however, are common and do not always lead to exiting SNAP.”

With respect to re-entry into the program, Mr. Tordella explained that, “Forty-seven percent of SNAP participants who exited the program in the panel period re-entered within 12 months. Another 12 percent re-entered within two years, for a total of 59 percent re-entering within 24 months. Participants returned to the program more quickly during 2008 to 2012 than prior study periods. In the mid-2000s, 53 percent of participants re-entered within two years.”

During the discussion portion of yesterday’s hearing, Chairman Walorski had the following exchange with Dr. Mills.

Rep. Jackie Walorski: Mr. Mills, I have a question for you. In your churn study, talking about the cycling of families on and off of benefits, you mentioned one of the reasons that recipients were experiencing personal difficulties. And kind of in a follow-up to a question I had yesterday on the full committee on SNAP about families getting real help, what’s the engagement level of states going into these recertifications?

Dr. Gregory Mills: It’s rather extensive. That is to say the effort that is put into the recertification is a full review of the eligibility factors of the case, so it’s immigration, citizenship, it’s their household income, expenses, and resources. So it is, in terms of case worker effort, it’s probably something like two to three hours of a case worker’s time.

Rep. Walorski: So there is a case worker from SNAP that potentially knows there’s a situation with a family?

Dr. Mills: A scheduled—well, I’m talking actually about a scheduled recertification, so those would occur typically at intervals of 12 or 24 months. The point I was trying to make in my testimony was that the, say, two to three hours that might be spent by a case worker at recertification is far less than what is required at an initial application. And the phenomenon of churn causes individuals, once they go off the program, many of them have to come back by going through a full initial application, which may require, say, six or seven hours of a case worker’s time, so it’s more—

Rep. Walorski: And what did you learn in your interview process on interviews with SNAP staff and those in the community-based organizations?

Dr. Mills: I indicated some of the recommendations that individuals have, the staff of these offices. We interviewed staff in one local office in each of the six states. We also interviewed representatives of community-based organizations. And I believe the chairman actually made reference in his opening statement the other day to the extension of the food assistance network to include food banks and other nonprofit organizations.

Some states do make use of such community-based organizations to assist clients in the outreach and in applying for benefits. That is a strategy that some states also use at recertification, allowing the client to be interviewed by a worker at a food bank if, for instance, they might find it difficult to get to a local office, and if they’re already going to that food bank and it would represent less burden for them.

Rep. Walorski: I appreciate it. Maybe this is the disadvantage of longer certification periods, fewer interactions and opportunities to help families. I appreciate your testimony.

And ranking member McGovern had this exchange with Dr. Mills.

Rep. Jim McGovern: Thank you very much. Just on this issue of churning and recertification, we had a witness here yesterday who said that there should be more certification processes. And I guess my question to you is, you know, how would requirements for more frequent recertification likely affect the churn rate?

Dr. Mills: I think of this as a tradeoff that’s a difficult one to make. As I pointed out in my testimony, there are multiple objectives here. You want to provide access to the program for those who are eligible for benefits, and at the same time you want to maintain the integrity of the program by not allowing those who are ineligible to access the program. So the procedural barriers exist for multiple reasons. You want to make sure that people in fact meet the eligibility requirements, but you don’t want to place those barriers or those hurdles so high that it might prevent those who are in fact entitled to receive benefits from entering the program.

In general, as I think you heard from [Robert Greenstein, President of the Center on Budget and Policy Priorities] the other day, the error rates in the program are very low. Only about 1% of recipients in the SNAP program are in fact ineligible and should not be receiving benefits. All others are eligible and perhaps not receiving the correct amount. But the program, by those measures, is very well administered, reflecting the amount of attention that goes into initial certification and recertification.

More barriers—I think that this is getting to your question—more barriers, more procedural requirements almost certainly would increase the rate of churn because there would be some individuals eligible for assistance who would not be able to meet those requirements, and they would go off, but they’d be unable to make ends meet without those benefits, they would reapply.

Rep. McGovern: Right. And I’d like to think that we all can agree that everybody who is eligible for this benefit should be able to get it, that we shouldn’t be going out of our way to make it more difficult for eligible people to get a food benefit.

And at the conclusion of Thursday’s hearing, Rep. McGovern noted that, “The SNAP program is a food program, it is not a job-training program, it is not a jobs program, and we need to make sure that everybody in this country has access to food; food ought to be a right- and I think this is a program that works.”

Also, in remarks yesterday on the House floor, Rep. McGovern noted in part that, “Mr. Speaker, yesterday the House Agriculture Committee – where I am proud to serve – held the first hearing in its ‘top-to-bottom’ review of the Supplemental Nutrition Assistance Program, or SNAP.

“SNAP is the nation’s pre-eminent anti-hunger program that provides critical food assistance to more than 46 million Americans. Last year, 16 million children – or 1 in 5 American children – relied on SNAP. Unfortunately, every indication is that Republicans will once again try to cut this critical safety-net program.”

Keith Good

Thursday Morning Update: Policy Issues; Trade; Ag Economy; and, Budget Issues

Policy Issues

On Wednesday, the House Agriculture Committee met to discuss the SNAP program and nutrition issues, a FarmPolicy.com summary and overview of this Committee hearing is available here.

Also on the SNAP issue, a report yesterday by  Mathematica Policy Research presented “estimates that, for each state, measure the need for SNAP and the program’s effectiveness in each of the three years from 2010 to 2012.”

The Mathematica item stated that, “This report presents estimates that, for each state, measure the need for SNAP and the program’s effectiveness in each of the three fiscal years from 2010 to 2012. The estimated numbers of people eligible for SNAP measure the need for the program. The estimated SNAP participation rates measure, state by state, the program’s performance in reaching its target population. In addition to the participation rates that pertain to all eligible people, we derived estimates of participation rates for the ‘working poor,’ that is, people who were eligible for SNAP and lived in households in which someone earned income from a job.”

The report noted that, “Tables III.1  and III.2  present our final shrinkage estimates of SNAP participation rates and the number of people eligible, respectively, in each state for FY 2010 to FY 2012 for all eligible people and for the working poor.”

Recall that he House Agriculture Nutrition Subcommittee will hold a hearing today, “to review SNAP recipient characteristics and dynamics.”

Also on Wednesday, Secretary of Agriculture Tom Vilisack presented testimony at the House Appropriations Subcommittee on Agriculture.

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House Ag Committee Hearing: SNAP (Food Stamps)

Categories: Farm Bill /Nutrition

At a House Agriculture Committee hearing on Wednesday that focused on the SNAP program and nutrition issues, Chairman Mike Conaway (R., Tex.) indicated that, “[The Supplemental Nutrition Assistance Program (SNAP)] is the largest program under the Committee’s jurisdiction, and today’s hearing marks the beginning of a top-to-bottom review of the program. We will conduct this review without preconceived notions and with a commitment to strengthening the program so it can serve as a tool to help individuals move up the economic ladder.”

Chairman Conaway added that, “We can all agree that no one ought to go hungry in America, and SNAP is essential in protecting the most vulnerable citizens during tough times. For many it is a vital lifeline to keeping food on the table. What we don’t want is for this program to hold people back from achieving their potential. I believe there is a role for SNAP, but we need to have a complete and clear understanding of its mission and purpose.”

Robert Greenstein, President of the Center on Budget and Policy Priorities, and University of Maryland Professor Douglas J. Besharov were the only two witnesses at Wednesday’s hearing.

In prepared testimony, Prof. Besharov noted that, “I applaud this committee’s multi-faceted re-examination of the program, its past, present, and future. Based on my research and analysis, I think the key challenge is to modernize a massive program that started as a small program of food assistance to become the primary US program of income support.”

Prof. Besharov added that, “That would mean coordinating the SNAP program with Temporary Assistance for Needy Families (TANF), Unemployment Insurance, Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI), and the Earned Income Tax Credit (EITC) and other tax credits. In doing so, there should be an effort to rationalize the current patchwork of programs that make up the US safety-net in a way that balances what looks to be long-term weak demand for labor economic with the need to minimize the work and marriage disincentives in current law.”

Prof. Besharov pointed out that, “Today, instead of hunger, the central nutritional problem facing the poor, indeed all Americans, is not too little food but, rather too much—or at least too many calories. Although there are still some pockets of real hunger in America, they are predominantly among populations with behavioral or emotional problems.”

In his testimony, Prof. Besharov explained that, “As I have described, states are financially and politically rewarded when they move people off UI and TANF (programs with at least some activation requirements) and on to SNAP. This incentive was not created deliberately, but, rather, is a historic accident of how and when the programs were established…[R]eal reform probably requires that the states be made financial partners of the federal government. States should have a more direct financial stake in the proper governance of SNAP programs, including of eligibility determinations. Given that all program funds come from the federal government, a substantial liberalization of eligibility determinations was predictable. State officials have little reason to be cost conscious—as long as program funds seem available.”

During the discussion portion of Wednesday’s hearing, House Ag Nutrition Subcommittee Chairwoman Jackie Walorski (R., Ind.) had this exchange with Prof. Besharov:

Rep. Walorski: “And I guess as we’ve talked about today, we’ve talked about the issue of how do families, how do single moms and how do underemployed families pay for food, and healthcare, and lodging, and daycare, how does all this happen. And my question is, when they finally get to a point where they have figured all this out, what then does the government do to really help these families?

“Has the SNAP program historically been just a Band-Aid to pass them on to the next…somebody else to deal with them or is there a sense that, you know, there’s an opportunity to actually look at what this government can do, should do, and actually getting real help to the financial challenges and how this happened to begin with? So I guess just historically, where do you see this? Has this always just been a Band-Aid to try to get people along or is there a long-term solution that’s been talked about?

Prof. Besharov: “Well, I think the world’s changed. Before 1996 we would have had this conversation about TANF. And what happened was when the Congress reformed TANF and the case loads went way down, the SNAP case loads, over time, over a 20 year period, went up. And as I said in my testimony, some people on the right, especially, call SNAP welfare 2.0, which is this is the new version of that.

The difference is that within the SNAP program, the states don’t have an incentive to really reform, to provide those kinds of uplifting services because of the formula. The formula is if a state wants to provide services to people in your district in Indiana, it has to pay 50% of the cost, but if it wants to just give out SNAP benefits, it only pays the administrative costs, and those are very low.

So my recommendation is that whatever the incentive is, whether it’s giving the states a bounty every time they get somebody from SNAP a job or an advanced degree or whatever, give them a financial incentive to help the people on SNAP. It’s not there now.”

A video replay of Rep. Walorski’s complete remarks at Wednesday’s hearing can be seen here:

Subcommittee Chairwoman Warloski also made the following tweet on Wednesday:

In his prepared remarks, Mr. Greenstein noted that, “As of the end of 2014, SNAP was helping more than 46 million low-income Americans to afford a nutritionally adequate diet by providing them with benefits via a debit card that can be used only to purchase food. The benefits are relatively modest. SNAP participants receive an average benefit of $1.42 per person per meal.”

Mr. Greenstein added that, “SNAP targets benefits on those most in need and least able to afford an adequate diet. Its benefit formula considers a household’s income level, along with its essential expenses such as rent, medicine, and child care needed to work. Although a family’s income is the most important factor affecting its ability to purchase food, it is not the only factor; a family whose rent and utility costs consume two-thirds of its income will have less money to buy food than a family that has the same income but receives a rental voucher to cover a portion of its rental costs.

“The program’s targeting of benefits adds some complexity. However, it helps to ensure that SNAP provides the largest levels of assistance to the poorest families with the greatest needs, and lesser assistance to those whose level of need is less severe.”

Mr. Greenstein pointed to research that “found that adults who had access to food stamps as young children had an 18 percentage point higher high school graduation rate than the children who hadn’t had access to food stamps. The children with access to food stamps also had significantly lower rates of ‘metabolic syndrome‘ (obesity, high blood pressure, heart disease, and diabetes) and better health in adulthood. In addition, women who had access to food stamps as young children had higher earnings and lower rates of welfare receipt in adulthood.”

Mr. Greenstein also pointed out that, “SNAP error rates now stand at record lows. Fewer than 1 percent of SNAP benefits are issued to households that do not meet all of the program’s eligibility requirements.”

Also at Wednesday’s hearing, House Ag Nutrition Subcommittee ranking member Jim McGovern (D., Mass.) raised questions about the hearing, noting that: “You know, today’s hearing is described as the start of a top to bottom review of SNAP, and I’m certainly a proponent of rigorous oversight of all programs. But I have to say, at the beginning, I find it a little bit curious that we seem to be singling out SNAP for review, especially at a time when the most recent CBO projections show that SNAP case loads and spending is moving in a downward direction, and CBO also says that payments to farmers could be nearly $5 billion more than was originally expected in the farm bill. I don’t know why we’re not beginning with a top to bottom review of that, but

“And I appreciate you being here. And I hope, if we’re going to do a top to bottom review, that we also, at some point, have a panel of beneficiaries, people who are on the program, who can testify firsthand what works and what doesn’t work. And maybe we should also have someone from [the Food and Nutrition Service] here as well, because they administer the program. I hope that this is not going to be an exercise in another attack against poor people because I fear I’ve seen this movie before, and I didn’t like it the first time. But it is what it is.”

Keith Good

Wednesday Morning Update: Senate Ag Committee Farm Bill Hearing, Ag Economy; Trade; Budget; and, Biofuels

Policy Issues- Senate Ag Committee Hearing; House Ag Committee Hearing Today

In two separate panels, agricultural producers and Secretary of Agriculture Tom Vilsack testified before the Senate Agriculture Committee on the implementation of  last year’s Farm Bill Tuesday morning.

A FarmPolicy.com summary and overview of the hearing is available here.

AP writer Mary Clare Jalonick reported on Tuesday that, “Congressional Republicans are laying the groundwork for an overhaul of the nation’s food stamp program, trying again after an unsuccessful attempt two years ago.

“House Agriculture Chairman Mike Conaway, R-Texas, said Tuesday that his panel is starting a comprehensive, multiyear review of the program to see what’s working. He said ‘either huge reforms or small reforms’ could come from that, though he wouldn’t detail what those might be.

“Conaway says a 2013 GOP effort to cut food stamps ‘didn’t resonate well’ because Republicans didn’t spell out why it was important. House Republican leaders tried unsuccessfully to cut the program by 5 percent annually by passing a bill with broad new work requirements.”

The AP article noted that, “Some Democrats say they are wary of the review process. Agriculture Committee member James McGovern, a Massachusetts Democrat who is a longtime advocate for food stamps, said he wonders why the SNAP program is singled out for review and not expensive farm programs.

“‘I am deeply concerned about this,’ McGovern said. ‘This is a program that by and large works.’”

Meanwhile, David Pierson reported yesterday at the Los Angeles Times Online that, “An estimated 9 million people are sickened and 1,000 killed by food-borne illnesses in the U.S. each year, but until now officials were unable to pinpoint which foods were most likely to blame.

“In a report released Tuesday, the U.S. Centers for Disease Control and Prevention, the U.S. Food and Drug Administration and the U.S. Department of Food and Agriculture’s Food Safety and Inspection Service detailed the sources of the most common food-borne illnesses with the aim of improving food safety and policy.”

The LA Times article noted that, “Among the findings: More than 80% of E. coli O157 cases were attributed to beef or crops such as leafy vegetables.

“About 75% of campylobacter illnesses were linked to dairy (66%), particularly raw milk dairy, and chicken (8%).

“More than 80% of listeria illnesses were attributed to fruit (50%) and dairy (31%).”

 

Agricultural Economy

Also on Tuesday, USDA’s National Agricultural Statistics Service released its annual U.S. Crop Values Summary, a link to the complete report along with highlights regarding corn and soybeans can also be found at FarmPolicy.com.

Tuesday’s Los Angeles Times contained an article highlighting ongoing drought concerns California. The article included this quote from Bill Patzert, a climatologist with the Jet Propulsion Laboratory: “If you think we’ve turned around on the drought, stop smoking whatever you’re smoking.”

Details on this article, as well as Reuters news updates that focused on agricultural issues in Brazil, Ukraine, and Russia have been posted here.

And Jon Hilsenrath reported on the front page of today’s Wall Street Journal that, “Federal Reserve Chairwoman Janet Yellen, sounding upbeat about the economy, laid the groundwork for interest-rate increases later this year.

“‘The employment situation in the United States has been improving on many dimensions,’ Ms. Yellen told the Senate Banking Committee on Tuesday, her first of two days of semiannual testimony before lawmakers. Spending and production had increased at a ‘solid rate,’ she added, and should remain strong enough to keep bringing unemployment down.”

 

Trade Issues (TPA, TPP); West Coast Ports

And in trade related news, William Mauldin reported in Wednesday’s Wall Street Journal that, “Lawmakers from both parties are trying to strike a difficult balance as they wrangle over the final intricacies of a bill that would expedite consideration of trade deals.

“House and Senate leaders crafting the so-called fast-track bill want to include sweeteners to attract skeptical Democrats, including rules to allow lawmakers greater access to the details of continuing trade negotiations.

“But supporters fear too many provisions friendly to Democrats could alienate Republicans and the business community, or even put a major Pacific trade deal at risk when it comes up for a final vote. The U.S., Japan and 10 other Pacific Rim countries are hoping to agree to the final terms of the trade partnership in coming months.”

Mr. Mauldin explained that, “The bill’s authors—Sen. Orrin Hatch (R., Utah), Sen. Ron Wyden (D., Ore.) and Rep. Paul Ryan (R., Wis.)—are now fighting over how much leverage to give lawmakers to remove any coming trade deals from fast-track protection. That would subject the pacts to ordinary amendments and procedural delays.”

Reuters writer Krista Hughes reported on Tuesday that, “U.S. Federal Reserve Chair Janet Yellen warned Congress on Tuesday against a bid to crack down on currency cheats and said adding currency rules to trade deals could hobble monetary policy.

“Lawmakers have introduced legislation allowing firms to seek compensation for currency weakness overseas and some are also fighting to include a currency chapter in upcoming trade deals such as the 12-nation Trans-Pacific Partnership (TPP).”

Also on Tuesday, Reuters news indicated that, “A meeting aimed at sealing a Pacific trade deal has been called for April, Mexico’s economy minister said on Tuesday, adding he was optimistic it would be sealed in the first half of 2015.

“‘I am very optimistic that there will be good news for the TPP in the first half of this year,’ Ildefonso Guajardo told Reuters, referring to the Trans-Pacific Partnership.”

On the West Coast Port issue, Diana Marcum reported on Tuesday at the Los Angeles Times Online that, “An end to labor strife at West Coast ports should speed up cargo operations, but it may be too late to help California’s drought-weary nut and citrus farmers.

Citrus took the hardest hit. Oranges, many bound for Chinese New Year celebrations, sat decaying on ships, at docks and on the ground as a nine-month labor dispute snarled ports. Fieldworkers, packinghouse employees and truck drivers had their hours cut.”

The article added that, “Losses could reach as high as 50% of citrus exports, or $500 million, according to trade groups… [F]or California’s almond farmers and processors, the severe cargo backlogs have raised fears that foreign buyers could cancel contracts for almonds stuck in storage and buy from other countries.”

 

Budget

David Nakamura and Sean Sullivan reported on the front page of today’s Washington Post that, “The Senate moved closer Tuesday to a deal to avert a partial shutdown of the Department of Homeland Security, but the proposal faced an uncertain future in the House, where Republican leaders conspicuously refused to embrace it.

“Senate Majority Leader Mitch McConnell (R-Ky.) told reporters he was prepared to move swiftly to extend funding for DHS through the fiscal year in a bill that is not contingent on Republican demands to repeal President Obama’s executive actions on immigration.”

 

Biofuels

Bloomberg writer Mario Parker reported on Tuesday that, “Ethanol producers are cutting output after getting squeezed by the biggest drop in gasoline prices since 2008.

“Valero Energy Corp. and Green Plains Renewable Energy Inc., representing about 15 percent of U.S. capacity, have reduced operations as margins narrowed. At a typical mill in Illinois that makes ethanol from corn, profit margins have almost totally disappeared, compared with $1.33 a gallon a year ago, according to AgTrader Talk, a Clive, Iowa-based consulting company.”

Keith Good

Senate Ag Committee Farm Bill Hearing

At a Senate Agriculture Committee hearing on Tuesday, lawmakers reviewed the implementation of the Farm Bill after one year and heard testimony from farmers and Secretary of Agriculture Tom Vilsack.

In his opening remarks, Chairman Pat Roberts (R., Kan.) indicated that, “As our first order of business it’s only right that we recognize and appreciate our leader of the past four years and the tremendous amount of good work she accomplished during a very difficult time.

Senator Stabenow is a dedicated and fierce leader of agriculture policy whose tenacity successfully carried a farm bill across the goal line when many believed it wouldn’t get done.”

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