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Published June 15, 2012, 12:49 PM

Farm bill stalled

WASHINGTON — With the farm bill stalled on the Senate floor, Senate Budget Committee Chairman Kent Conrad, D-N.D., Sen. Saxby Chambliss, R-Ga., Senate Finance Committee Chairman Max Baucus, D-Mont., and Sen. John Hoeven, R-N.D., on June 14 introduced an amendment to raise target prices and continue countercylical payments for the next five years that may be the key to get the farm bill through the Senate.

By: Jerry Hagstrom, Agweek

WASHINGTON — With the farm bill stalled on the Senate floor, Senate Budget Committee Chairman Kent Conrad, D-N.D., Sen. Saxby Chambliss, R-Ga., Senate Finance Committee Chairman Max Baucus, D-Mont., and Sen. John Hoeven, R-N.D., on June 14 introduced an amendment to raise target prices and continue countercylical payments for the next five years that may be the key to get the farm bill through the Senate.

The bill address concerns of both rice and peanut growers and the National Farmers Union that the proposal in the current Senate proposal to cover some “shallow losses" not covered by crop insurance could diminish over time if prices go down and the benchmark used to determine payments declines along with it. But the target prices in what is known in Washington as the Conrad proposal are not as high as those that were in the proposal sent to the supercommittee on budget reduction in December.

The Conrad proposal has been written as an add-on to the shallow-loss proposal. The amendment would raise target prices between 4 and 7 percent from their current levels, which would be lower than the prices in the proposal that was sent to the supercommittee on deficit reduction in December.

“If we are going to get a farm bill, we’ve got to find a way to work through these amendments and come to agreement,” said Hoeven, who spoke on the Senate floor Thursday, urging lawmakers to work together in a bipartisan way to get consensus on the many amendments that have been submitted to new farm bill that he and members of the U.S. Senate Agriculture Committee crafted. “We have to come together in a bipartisan way, work together and come up with an agreement so that we can have a reasonable number of amendments brought forward, vote on those amendments and pass a farm bill,” the senator said. “We absolutely should be able to get that done because this bill accomplishes some very important things for our country.”

A lobbyist said the target price increases were moderate so that they could be offset. A Conrad spokesman said that the bill would be offset, but had not yet received a score from the Congressional Budget Office.

The Conrad spokesman said the offset was still under discussion, but lobbyists said the proposed offsets are the elimination of a provision under which farmers who have not grown a crop are allowed to insert “an actual production history (APH) plug” to be used as a basis for crop insurance and a cut in the new peanut revenue insurance program.

The program is expected to cost a little more than $1 billion over 10 years, with the APH plug contributing $800 million in budget savings.

Lobbyists who favor target prices and those who oppose them described the Conrad bill as a “placeholder” that could get the bill through the Senate, but would not satisfy rice and peanut growers as a final piece of legislation.

If target prices are higher, then farmers would probably have to choose between the shallow loss program and the target price program. One congressional aide also suggested that another option would be to reduce the payments under the shallow loss program, known as the Agricultural Risk Coverage program. One lobbyist said that some groups would object to tying target prices to current rather than historical production because that could skew production toward some crops.

The amendment would pay farmers on 75 percent of acres planted or prevented from being planted, but not to exceed 75 percent of the total base acres for the covered commodity established for the 2012 crop year. It contains a separate payment limitation on countercyclical payments of $65,000 per year.

Conrad said, “This is one step in a process to achieve a bipartisan, multiregional agreement on Title I provisions,” in a statement to National Journal.

“This is still a work in progress as we seek a responsible bipartisan, multiregional approach to providing an adequate safety net for farmers and the fact that the senators from the upper plains are involved is a clear indication that other regions aren’t enamored with (shallow loss),” Chambliss said in a statement to National Journal.

Most lobbyists contacted by Agweek declined to comment on the Conrad amendment.

But National Farmers Union President Roger Johnson said in an email, "Based on the information we have, the amendment is a step in the right direction of providing deep price loss protection that can help farmers in all regions of the country in addition to shallow loss revenue protection."

Ferd Hoefner of the National Sustainable Agriculture Coalition, said, “This is an end-run around payment limit reform. We are not opposed to an option for price protection if it fits within the budget parameters, but we adamantly oppose any provision that weakens the payment limit reform adopted by the committee.”

One lobbyist said that the amendment proved that “Conrad and Chambliss are doing what they are known for — trying to find solutions to seemingly intractable problems.”

As the Senate prepared to go out of session for the weekend, Senate Agriculture Committee Chair Debbie Stabenow, D-Mich., said June 14 that she has made progress on putting together a package of amendments to the farm bill.

“We made very good progress today. We overcame some obstacles, we put something together for the Senate for the beginning of the week,” Stabenow said at the conclusion of a week in which the Senate made no serious progress on the bill.

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