WASHINGTON — Congressional farm leaders are trying to come up with a draft farm bill compromise between the House and the Senate by Nov. 22 just as lower prices for corn and other commodities are intensifying the need for an updated farm safety net.
“This is the deadline week” House Agriculture Committee Chairman Frank Lucas, R-Okla., told the Capital Press on Nov. 19, the same day Senate Agriculture Committee Chairman Debbie Stabenow, D-Mich., said she hopes a “framework” can be released “by the end of the week or very shortly thereafter.”
If Congress does not finish a new farm bill by Dec. 3, the country will face higher dairy prices in 2014, just as it did last year when Congress included a one-year extension of the farm bill in what became known as the “fiscal cliff” legislation. The House-Senate conference committee needs to finalize the bill quickly so that each chamber can consider the conference report in December and, if passed, it could go to President Barack Obama for his signature.
Both Lucas and Stabenow were cautious about their prospects.
“We’re in the middle of everything,” Stabenow said. “One thing depends on another. It’s a big Rubik’s Cube.”
Lucas noted that the conferees do not have “a common number” on cutting the Supplemental Nutrition Assistance Program, better known as SNAP or food stamps. Lucas noted that the Senate-passed bill cuts only $4 billion and that the House bill would cut $39 billion.
“We’ve got to have real progress,” said Lucas, but in a possible sign of movement Lucas had a 20 minute discussion with Rep. Jim McGovern, D-Conn., a strong anti-hunger advocate, on the House floor on Nov. 19 during a vote on an unrelated matter.
Lucas also said that the conferees “have had some pretty thorough discussions of all parts of the farm bill.”
The only subject that conferees have not discussed, Lucas said, is the proposal to make changes to country-of-origin labeling (COOL) for red meat. Lucas said he believes that discussion will be left for a public meeting of conferees.
Lucas and Stabenow talked to the press only a few days after the Environmental Protection Agency announced that it is proposing to lower the volumetric requirements for biofuels in 2014 under the Renewable Fuel Standard. That decision plus a big crop caused corn prices to drop, but Lucas said the bright side of that situation is that it might cause farm groups to compromise on the commodity title of the bill.
The core of the Senate farm bill commodity title is a program favored by corn and soybean growers that would pay for what they call “shallow losses” not covered by crop insurance while the House bill’s core is a target price-based program favored by rice and peanut growers and advocates who believe that the value of the Senate bill will decline over time if prices are low because the base for the payments will decline along with market prices.
The differences in approach would also affect which region of the country gets most of those payments.
Also controversial is whether payments would be made on farmers’ historic base acreage or current planted acreage. Advocates of free trade say that using planted acreage could bring charges in the World Trade Organization that the United States is encouraging production of specific commodities. But other farm leaders say that making payments on historic base acreage is indefensible to the American public.
The American Soybean Association, the National Corn Growers Association and the U.S. Canola Association on Nov. 19 proposed a compromise using the average of planted acres during the five years previous to the current year as the payment base for both the revenue and the price programs.
“The average would move forward, adding and dropping a year every year, in order to remain as current as possible without including the current year, which would serve as a deterrent to building base,” the groups wrote.
The possibility that lower prices may lead to higher subsidies has also increased farmer resistance to the farm subsidy payment limit provisions that are in both the House and Senate bills.
Both versions of the farm bill would allow a single person up to $75,000 in marketing-loan gains and up to $50,000 in payments through whatever commodity programs are in the bill. The payment cap for a married couple would be double.
Sen. Charles Grassley, R-Iowa, an advocate of payment limitations, said that the battle is likely to be fought over the definition of who is “actively engaged” in farming and eligible for subsidies. If fewer people are eligible for subsidies, then a farm operation would get less in subsidies.
Southern farmers, particularly rice growers with large operations, are fighting the hardest to avoid the tougher limits.
The new bill also contains changes to conservation programs and programs to benefit fruit and vegetable growers and farmers’ markets but the differences between the House and the Senate on most of those issues is not as big as in the commodity programs.