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Published February 18, 2013, 11:10 AM

Stabenow pushes sequestration package

Package would drop direct payments, avoid USDA cuts, fund rest of farm bill

By: Jerry Hagstrom, Agweek

WASHINGTON — Senate Democrats will offer a sequestration package that would eliminate the direct payments package for savings of $27.5 billion, avoid all sequestration-related U.S. Department of Agriculture cuts including meat inspections, and fund disaster assistance and all the programs that were left out of the extension of the farm bill, Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., said late on Feb. 14.

The cost of the farm bill extension would be $3.5 billion, with the bulk of that money going to disaster assistance and the rest to energy programs, research, specialty crops and organic agriculture. Stabenow said the drought will continue and that disaster aid is needed.

The National Sustainable Agriculture Coalition said the elimination of the direct payments would save a total of $31 billion over 10 years and that the $3.5 billion would be taken from that.

“Our provision will fund disaster assistance and fill the holes in the extension that was passed on New Year’s Eve so that we are supporting all of agriculture,” Stabenow said.

The farm bill provisions are part of a larger sequestration package offered by Senate Majority Leader Harry Reid, D-Nev.

But whether the package will be enacted into law is highly questionable because half the money to avoid the cuts would come from decreases in spending and half would come from what Stabenow described as “closing tax loopholes on the wealthy and the well-connected.”

Republicans have said they are opposed to any increase in taxes.

Stabenow said she expects a vote on the sequester measure after the Senate comes back from a one-week President’s Day recess, but before March 1, when sequestration is scheduled to kick in. She said she has discussed the proposal with other Democratic members of the committee and is only now beginning to discuss it with the Republican members.

She also said she has had “general” discussions with House Agriculture Committee Chairman Frank Lucas, R-Okla., and ranking member Collin Peterson, D-Minn., but did not want to imply an endorsement from either of them.

Furloughs, cuts

The Obama administration has said that if sequestration goes forward, it will include 15-day furloughs for more than 6,000 federal meat, poultry and egg product inspectors and require taking 600,000 low-income mothers and small children off the Special Nutrition Program for Women, Infants and Children, known as WIC.

If the measure passes, the agriculture committees would be relieved of making further cuts when writing a new five-year farm bill. Stabenow said she is confident that Congress could write a farm bill with the money remaining in the commodity title.

Stabenow said Democrats have settled on eliminating the direct payments that crop farmers get whether prices are high or low because there had been bipartisan agreement last year in both the House and the Senate to eliminate them.

She said the cuts to the direct payments could begin in either fiscal year 2013 or 2014, but that 2014 is more likely. USDA’s Farm Service Agency has scheduled sign up for this year’s farm programs to begin Feb. 19 and it is unlikely Congress would eliminate funding for a program for which registration has begun.

Stabenow said farmers should sign up for the programs as scheduled, adding “I am assuming as always that contracts are honored.”

If the sequestration bill passes, the committees would not be required to make cuts in any other program in the agriculture budget function, including food stamps and conservation programs, which were cut in the farm bill that passed the Senate in 2012, but Stabenow said there still could be changes to specific farm bill programs for policy reasons.

The National Sustainable Agriculture Coalition endorsed the proposal and praised Reid for offering the package.

“The Reid proposal would end direct payments and restore the farm bill programs that were left out of the farm bill extension portion of the fiscal cliff deal,” NSAC Policy Director Ferd Hoefner said in a news release.

“Those programs — for renewable energy, rural small businesses, value-added agriculture, new and beginning farmers, conservation, specialty crops, organic farming, minority farmers and local food producers — were all thrown under the bus in the fiscal cliff deal in order to preserve every last dollar of unneeded, untargeted and antiquated direct subsidies,” Hoefner said. “The Reid proposal would right that wrong. It would also provide immediate funding for livestock disaster assistance, another item left out of the fiscal cliff deal.”

NSAC also said that the Reid bill would cut defense spending and net farm bill spending each by $27.5 billion over the coming decade and that it would also raise an additional $55 billion “by closing two tax dodges and placing a minimum tax on millionaires to counteract the effect of tax loopholes, to raise an additional $55 billion.

“Without new action by Congress, sequestration goes into effect on March 1, cutting farm commodity and conservation programs by some $7 billion and reducing every USDA discretionary program by 5 percent,” NSAC said.

USDA has not, however, confirmed those numbers.

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