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Farm Bill

The Farm Bill: charting the course
for federal agricultural policy

 

Funding for rural hospitals, school lunch programs, WIC food coupons for low-income families, conservation incentives, market development and research, port-of-entry inspections and detection services, crop research, crop insurance and commodity payments -- all are provisions which will likely be included in the next Farm Bill.

The federal Farm Bill sets the United States’ farm and food policies for a five-year period. The 2007 bill, now being crafted by Congress, will be a comprehensive, diverse package of legislation that will impact rural areas, farmers and ranchers and consumer alike. 

Traditionally, federal farm policy has been heavily influenced by commodity crops: corn, soybeans, wheat, rice and cotton.  The 2007 Farm Bill has already appeared to be different, as California’s specialty crops are being recognized and funding for marketing, research, and healthy eating programs is being included.

Background:  The 2002 Farm Bill expires this year, with some features ending as early as Sept. 30.  Unless Congress renews or extends the current bill, the authorizing legislation reverts to statutory language established in 1939, so there is a sense of urgency to get it done this year.  The Farm Bill covers 11 titles including: the commodity title and its various farm support programs, conservation, research, trade/market development, energy, nutrition and a miscellaneous section which includes country of origin labeling.  Nutrition and related food stamp programs constitute roughly 70 percent of the total farm bill spending total, but that part of the bill attracts far less attention or discussion.

This time around, due to projected budget restrictions, the total amount of money available for farm programs and related spending is limited to $8 billion per year, excluding conservation programs. Some farm bill spending is classified as mandatory, including the commodity programs, food stamps and nutrition outlays.  Other programs such as conservation, research, trade and energy are considered discretionary.  As such, they are authorized in the Farm Bill, but require annual spending approval.

Roughly 10 percent of California’s producers receive government monies either in the form of farm program price support payments or for qualified conservation practices.  In 2004, total federal payments to California agriculture amounted to $393 million.  This support level is roughly two percent of the total U.S. agricultural outlays on an annual basis.  Of that total, $354 million represented farm program payments, $30 million came in the form of disaster payments and $19.5 million came as conservation payments.  The major California farm program commodities include cotton, rice, wheat and dairy. 

California is the largest agricultural producer in the nation, mostly thanks to its $17 billion-a-year specialty crop industry. Fruits, nuts and vegetables now make up more than half of the value of all crops grown in the U.S., and organic produce and meats are the fastest-growing segment of farming. Yet they have never received the direct subsidies that go to specific commodity crops every five years in the farm bill that now is up for renewal.

Timeline:  While field hearings and listening sessions have been underway for the past two years, the legislative process began in July in the House Agriculture Committee.  The six House Agriculture subcommittees met and produced language covering their areas of responsibility. The House is expected to arrive at a final bill before it breaks for summer recess starting Aug. 6.

The Senate has made little progress, so it is unlikely they will act before the August recess. Differences will inevitably occur in the House and Senate versions. The differences must be resolved in a joint conference committee.  This will likely occur in September or early-October.   

The Latest Developments:   The House Agriculture Committee on July 20 passed mark-up of the 2007 Farm Bill that includes investments in conservation, nutrition and renewable energy while maintaining a strong safety net for America’s farmers and ranchers. Debate is continuing on amendments.

Important highlights of the Farm Bill (H.R. 2419) include:

  • Investing more than $1.6 billion in priorities to strengthen and support the fruit and vegetable industry in the United States. A new section for Horticulture and Organic Agriculture includes nutrition, research, pest management and trade promotion programs.
  • Providing farmers participating in commodity programs with a choice between traditional price protection and new market-oriented revenue coverage payments.
  • Strengthening payment limits to no more than $1 million a year (adjusted gross income).
  • Rebalancing loan rates and target prices among commodities, achieving greater regional equity.
  • Cutting federal payment rates to crop insurance companies to higher crop price offsets.
  • Extending and makes significant new investments in popular conservation programs, including the Conservation Reserve Program, Wetlands Reserve Program, Environmental Quality Incentive Program, Farm and Ranchland Protection Program, and many others.
  • Expanding the USDA Snack Program, which helps schools provide healthy snacks to students during after-school activities to all 50 states and continuing the DOD Fresh Fruit and Vegetable Program, which provides a variety of fresh produce to schools.
  • Strengthening and enhancing the food stamp program by reforming benefit rules to improve coverage of food costs and expand access to the program with additional funding support.
  • Including key provisions that invest in rural communities nationwide, including economic development programs and access to broadband telecommunication services.
  • Establishing a new National Agriculture Research Program Office to coordinate the programs and activities of USDA’s research agencies to minimize duplication and maximize coordination at all levels and creates a competitive grants program.
  • Protecting and sustaining our nation’s forest resources.
  • Making important new investments in renewable energy research, development and production in rural America.

Copies of the bill considered by the Committee and the amendments that were adopted are available on the Committee’s website at: House Agriculture Committee Farm Bill page.

California Farm Bureau Federation’s Farm Bill Priorities:

 

  • Expansion of Conservation Programs to benefit California’s working farmlands to encourage the following:
    • Reducing Greenhouse Gasses: Many existing farm practices reduce greenhouse gases.  These practices should be further encouraged with the creation of programs that foster the emergence of market opportunities for trading.
    • Improving Air Quality: We support new funding available to growers to meet air quality standards, as described in the Eat Healthy America Act (Cardoza).
    • Excluding Conservation Program Payments from Adjusted Gross Income (AGI) limitation to expand participation of California producers.
  • Maintain the Current Planting Prohibition. We support this long-standing farm bill provision as a fundamental matter of equity among farmers.  As long as some farmers receive federal payments, they should not be allowed to plant fruits and vegetables on that program acreage.  
  • Maintain the Current Level of Payment Limits.  California farmers are often targeted with restrictive payment limits, but with higher land values, greater economies of scale and higher production costs, our state should not be penalized when arbitrary limits are set.
  • Expand Nutritional Programs that encourage better nutrition and greater consumption of U.S. grown products. 
    • Provide new mandatory funding of an additional $500 million over 10 years for the purchasing of all fruits and vegetables.
    • Expand the USDA fresh fruit and vegetable snack program to 100 schools in each state.
    • Enforce the “Buy American” purchasing requirements in Federal nutrition programs.
  • Increase Consumer Awareness by implementing Mandatory Country of Origin Labeling (COOL) that provides consumers with the tools and resources to make informed purchasing decisions, specifically about where their food is grown. 
  • Strengthen Pest and Disease Exclusion Programs: The authority for pest and disease exclusion and detection programs at our points of entry should be restored to USDA/APHIS, instead of maintaining it under the Department of Homeland Security. In addition, authority should be given to the Secretary of Food and Agriculture to access CCC funds for emergency eradication programs.
  • Increase Trade Promotion and Development:  Increase funding for the Market Access Program (MAP) and programs that allow California producers to tackle unfair non-tariff trade barriers.
  • Increase Research Funding to focus on new technologies and mechanization for crops: 
    • Creation of the Specialty Crops and Policy Research Institute
    • $2.3 million for four USDA/ARS scientists in California to specialize in water and air quality issues as they relate to dairy and forage production. 
  • Expand Energy Opportunities that utilize agricultural byproducts:
    • $1.6 billion for research and further development of alternative fuels, focusing on regional feedstock supplies.  This will reduce our dependence on corn-based ethanol production. 
    • Funding for methane digesters should be increased beyond $11 million annually.

Sources: California Farm Bureau Federation and USDA

 

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