House Agriculture Committee Unveils Draft Farm Bill With $12 Billion in Additional Savings Over Senate Companion Legislation
Last week the US House Agriculture Committee released their draft version of a farm bill dubbed, the Federal Agriculture Reform and Risk Management Act (FARRM).
Some highlights of FARRM include:
- Saves more than $35 billion in mandatory funding, $12 billion more than the Senate version passed last month. (The US Senate version saves $23 billion)
- Eliminates direct payments, streamlines and reforms commodity policy. It allows a one-time election for producers to choose between two options on a crop-by-crop and farm-by-farm basis. Under either option, the risk management tool provided is only there for producers when they suffer a significant loss:
- Price Loss Coverage (PLC) is a risk management tool that addresses deep, multiple-year price declines. PLC will complement federal crop insurance, which is not designed to cover multiple-year price declines. PLC uses modern yields and an index of below cost of production prices to establish a market-oriented, price-based risk management tool for producers. PLC limits budget exposure by only considering deep, multiple-year price losses, and prevents the need for costly producer payments when markets collapse.
- Revenue Loss Coverage (RLC) is a risk management tool that considers revenue losses, similar to the Senate version of Agriculture Risk Coverage (ARC): RLC requires a producer to experience at least a 15% loss and coverage is based on county-wide losses. RLC uses yield plugs and an index of below cost-of-production prices as a benchmark in establishing a revenue-based risk management tool for producers.
- The draft legislation provides full planting flexibility to ensure that producers plant for market and agronomic conditions.
- Cotton producers are ineligible for PLC or RLC, but may purchase an area-wide, group-risk crop insurance policy, known generally as STAX.
- Producers remain eligible for marketing loans under the same repayment terms except in the case of cotton. For cotton, loan rates may be reduced from current levels, consistent with the STAX proposal.
- Cuts Supplemental Nutrition Assistance Program (SNAP) by $16 billion. (Senate version saves $4.5 billion)
- Consolidates 23 conservation programs into 13 creating $6 billion in savings. The program maintains the Conservation Innovation Grant (CIG) program to promote new and innovative conservation practices. Environmental Quality Incentives Program (EQIP) funding is maintained at current level.
- 14 Rural Development programs are eliminated and funding levels are reduced by more than $1.5 billion over five years, a 50 percent reduction in authorizations.
- Increases funding for the Specialty Crop Block Grant Program, ($70 million annually, FY 2013 and thereafter) which has been successful in enhancing the competitiveness of specialty crops through grants awarded to states to support research, product quality enhancement, food safety, and other projects important to the specialty crop industry. Multi-state Projects $1 million FY 2013, $2 million FY 2014, $3 million FY 2015, $4 million FY 2016 and $5 million FY 2017.
- Farmers Market Promotion Program increases funding for competitive grants ($20 million annually FY 2013-17)to improve and expand direct producer-to-consumer market opportunities including the development of local food system infrastructure.
- Includes NPDES language clarifying that, as it has been for the past three decades, Federal Insecticide, Fungicide and Rodenticide Act (FIFRA)-compliant pesticide applications are not subject to the Clean Water Act’s National Pollutant Discharge Elimination System (NPDES) permitting requirements.
- Includes continuation of pest and disease provisions and increases the funding level to $71.5 million annually (10-year: $186 million outlays, $215 million budget authority) an annual increase of $11.5 million over current program authorization.
- Includes a provision reiterating that the sole and exclusive authority of the Secretary to regulate products of biotechnology under the Plant Protection Act is to be limited to the evaluation of plant pest risk while authorizing the conduct of a targeted and transparent environmental review to facilitate public understanding and scientific discourse. Under the Plant Protection Act, the Secretary is authorized to regulate the introduction and cultivation of products of biotechnology if the product poses a plant pest risk. When a petition for non-regulated status is received a comprehensive plant pest risk assessment is conducted. Once it is determined that the product poses no plant pest risk, the authority to regulate the product under the Plant Protection Act ceases and a final decision is made to deregulate the product. Recent petitions for deregulation have taken several years, though the actual review takes only weeks and USDA regulation provides for a maximum limit of 180 days.
- Includes the third reauthorization of the Pesticide Registration Improvement Act. This legislative proposal represents a multi-year effort by pesticide manufacturers, non-governmental organizations and the Environmental Protection Agency to negotiate the content of legislation, which would provide additional resources for the Environmental Protection Agency’s registration activities and provide a more predictable service for pesticide registrants.
- Includes outreach and technical assistance available to enable specialty crop and organic producers to participate in the program.
- $9 million annually for specialty Crop Technical Assistance
- Specialty Crop Research Initiative funded through Commodity Credit Corporation (CCC) $25 million FY 2013, $30 million FY 2014-15, $65 million FY 2016, $50 million FY 2017 and thereafter.
The House Agriculture Committee will consider the legislation during a business meeting scheduled for Wednesday, July 11.
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