Agricultural News
Farm Bill Update- Oklahoma Farm Bureau Delegates Set Policy as Talk Emerges of Two Farm Bill Approach in Washington
Mon, 14 Nov 2011 05:47:25 CST
The Oklahoma Farm Bureau went on record with recommendations from their Farm Bill Committee established at the 2010 Convention by delegates- their farm policy recommendations included a statement that "Crop Ins is top priority of Farm Bill- we should do all we can to protect it." They also acknowledged the political reality that direct farm program payments will likely be gone after the 2012 crop year, stating that if funding for direct payments is reduced by more than 33%, the dollars that can be saved and used for farm programs from that pot of money should be used in other farm safety net programs that will offer revenue assurance.
OFB policy as approved by the delegates also states that "We encourage OFB to support ideas for the Farm Billthat meet the goals of: 1- providing a safety net for the farm operator; 2- a safe environment; 3- production of a sage and adequate food, fuel and fiber supply; and 4- continuing to support conservation programs." The delegates also approved the statement that "Governemtn farm programs should focus on providing farmers with downside risk protection. We support a policy tool that continues to provide a dix share of the federal budget allocation for agriculture, is a WTO green box policy, and is considered as part of a revenue assurance program. The best way to spend government dollars is revenue based safety net programs such as revenue assurance programs and crop insurance for all crops. We support a modified ACRE type program that would trigger on Crop Reporting Districts. In the future, we should rely less on government and increasingly more on free markets."
Delegates also agreed to the statement "A study should be done on the overlap between farm programs and crop insurance in order to prevent overlap for the major disaster on the portion of crop and livestock nor covered by other revenue based safety nets such as revenue assurance programs and where crop and livestock insurance was not available."
In other actions- the delegates spoke out against continuing tax credits for ethanol- calling that industry "mature." Specifically- they stated "It is time the mature corn-based ethanol industry operates on a level playing field with other commodities whose largest input cost is corn(such as cattle, hogs and poultry)."
We talked with Matt Muller of Jackson County, who served on the OFB Farm Bill Committee, about their recommendations to the delegates- and how they fit with the unfolding developments in Washington as the Ag Committee Leadership try to pull together a farm bill deal to send to the Super Committee. Click on the LISTEN BAR below to hear our visit with Matt Muller.
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AND- here is a good overview of where the Ag Committee Leadership stands and what might be coming out in the way of a Bullet Point Proposal for the Super Committee now that would outline how the $23 billion in savings would be achieved over the next ten years- which would leave the balance of the farm bill to be written with those budget dictates in the election year of 2012. This rundown of what is unfolding comes from the Oklahoma Grain and Feed Association- and from the National Grain and Feed Association:
"It looked like all was good heading into last week's creation of a new framework on what the direct farm payment portions of the budget would look like going into the 2012 Farm Bill, but the effort ground to a halt again this week over regional differences, a new wave of "save-the-program" voices, and growing criticism the process is creating a "secret farm bill." The rewrite of direct farm program payments - direct payments, subsidies, countercyclical, ACRE, loans, etc. - is part of back-and-forth negotiations among the top four members of the respective ag committees - Senate Ag Committee Chair Debbie Stabenow (D, MI), Sen. Pat Roberts (R, KS), ranking member, House Ag Committee Chair Frank Lucas (R, OK) and ranking member Rep. Collin Peterson (D, MN).
"Their challenge is to make good on their collective commitment to the Joint Special Committee on Deficit Reduction, aka the "super committee," on how to cut a proposed $23 billion from ag spending over the next decade. Critics contend this is "back-door" drafting of a five-year Farm Bill avoids open process. Rep. Ron Kind (D, WI), who has introduced his own version of comprehensive farm bills over time, is leading the House charge to open the process and was a vocal critic of the this week, saying, "This is a horrible process. It keeps Congress and the whole nation in the dark."
"Details of the House and Senate ag panel plans were supposed to be made public this week, but the committees have not yet released the written documents; the new deadline is sometime the week of November 14.
New approaches - almost all tied to some form of new federal revenue protection insurance - proposed by national commodity groups to rework the farm income safety net, are being sidelined for now. There will likely be two "Farm Bills;" the first written as part of the deficit reduction package and concentrating on direct farm program payments, but not effective until the 2008 Farm Bill expires on September 30, 2012, along with rewrites of conservation and crop insurance titles.
"The second Farm Bill will be written next year and will incorporate at least the framework of whatever's agreed to in the deficit reduction package, but "refining" the income safety net alternative, tracking the needs of individual commodities and regions, as well as fixing whatever mistakes are made in the first reinvention. The rest of the Farm Bill titles - research, disaster assistance, export, energy, etc. - will be written next year and within the budget confines of the deficit reduction agreement. Stabenow and Lucas continue to look favorably on "shallow loss" federal revenue insurance. Under this program, a farmer absorbs only the first 5-10% of income loss, with the federal government picking up the next 20-25% of the loss before federal revenue insurance kicks in. Critics, including the American Farm Bureau Federation (AFBF), say this could entice farmers to take greater risks than they might otherwise. Others contend the base "income" figures that would be used to set the bar on payments would likely be based on 2010-11 net on-farm income, the highest since 1974, when adjusted for inflation, and this would essentially negate any savings over 10 years. Further, if a county-wide revenue calculation is used - similar to the current ACRE mechanism - lawmakers from westerns and southern states contend that with their relatively larger counties, the benefit will be spotty based on the broad income averages.
"The super committee's deadline for producing a bill - including the $23 billion in ag spending cuts - is November 23; if it fails, $1.2 trillion in across-the-board federal spending cuts kick in, with ag likely taking a hit well below the $23 billion promised by the two ag committees."
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