Senate Farm Bill Outlook

Posted by Brad Johnson Mon, 30 Jul 2007 22:23:00 GMT

From Broader Policy Overhaul May Be in Store as Senate Takes Up Farm Bill.

  • Senate will take up bill after August recess; making the September 30 deadline unlikely
  • Sen. Harkin, Ag Committee chair, plans much higher land-conservation program funding than in House bill (HR 2419)
  • Harkin and Grassley (R-Iowa) plan to cap annual payments to $250,000 from current cap of $360,000; HR 2419 has no cap
  • Sen. Lugar (R-Ind.) supports FARM21, Ron Kind’s proposal (H.AMDT 700)
  • Sens. Durbin (D-Ill.) and Brown (D-Ohio) introduced the Farm Safety Net Improvement Act last week, which ties “counter-cyclical” payments (aka crop subsidy payments) to revenue (price times yield) instead of the target price (see the American Farmland Trust page)
  • Nutrition advocates are looking for better than the $4 billion increase in the House bill
  • Tax provisions to pay for the Senate bill will generate Republican resistance

Full text below the fold.

Broader Policy Overhaul May Be in Store as Senate Takes Up Farm Bill By Catharine Richert, CQ Staff

The Senate is prepared to write a dramatically different farm bill than the version the House passed last week.

The Senate debate will not happen until September or later. For now, Senate Agriculture Chairman Tom Harkin, D-Iowa, has promised to increase funding for land-conservation programs far above House numbers.

The $286 billion, five-year House measure (HR 2419), which passed, 231-191, on July 27, would impose new limits on farm subsidies, increase support for fruit and vegetable growers, boost land conservation and increase funding for nutrition programs. Farmers making more than $1 million a year would not be eligible for federal assistance.

Given the tight budget for the farm bill, subsidies are likely to be Harkin’s first target. He has said he will support a proposal by Charles E. Grassley, R-Iowa, that would cap the amount of money a farmer can get at $250,000 a year. Currently, the cap is $360,000 a year. The House bill does not include an overall payment cap.

Harkin has other options. Richard G. Lugar, R-Ind., supports FARM21, a version of a proposal by Rep. Ron Kind, D-Wis., that the House rejected. It would have phased out some subsidies and ­reinvested billions into conservation, nutrition and rural development programs.

Sens. Sherrod Brown, D-Ohio, and Richard J. Durbin, D-Ill., issued a plan to link countercyclical payments, which kick in when the price of a crop drops below a government-set target, to a crop’s revenue instead. They say their plan would be cheaper and more compliant with international trade law.

The flurry of proposals signals that the Senate is more open to a broad overhaul of the 2002 farm law (PL 107-171), says Scott Faber, farm policy director for Environmental Defense, an organization that will seek deeper cuts to subsidies and more money for conservation programs.

Also hoping for a bigger pot of money are nutrition advocates, who asked the House for an extra $20 billion over five years for a broad range of food programs.

Ellen Vollinger, who works for the Food Research and Action Center, said that money may be difficult to find in the Senate because of the tight budget. Her group may be looking for a much smaller amount, she said. The House bill proposes a $4 billion increase to various nutrition programs over five years.

Some of the extra cash for nutrition programs in the House bill came from cuts to crop insurance. Agriculture Chairman Collin C. Peterson, D-Minn., made those changes at the last minute to mollify food stamp advocates such as Jim McGovern, D-Mass., who vowed to vote against the bill unless it did more to boost nutrition.

The rest of it came from a provision that would tax foreign companies doing business here — which almost sunk the House bill. Most Republicans voted against the measure over the tax provision.

If a similar provision appears in the Senate farm bill — or becomes an issue in the expected conference on the legislation — big business is sure to launch an attack claiming that the package would discourage foreign companies from setting up shop in the United States.