Posted by: Phillip Fraas
April 19, 2008
Topic: REPORTS ON 2008 FARM BILL STATUS--January 2008 To Enactment

The House and Senate conferees on the farm bill met several times this week and completed work on the credit, research, trade, and forestry titles. However, they remain at odds on the critical issues of how much added funding to put into nutrition programs, whether to include a permanent disaster assistance program in the bill, whether to accept the Senate package of tax credits, and how to fund increases in spending over the farm bill base line.

Congress also approved, and the President signed, a one-week extension of the current farm programs--to next Friday, April 25. This gives Congess a little extra time to wrap things up in their farm bill negotiations.

ONE-WEEK EXTENSION: Many farm programs are annual in nature because only one crop of a commodity is produced in a year. For these programs, it is not critical whether the new farm bill is approved on April 18 or April 25.

For example, the cotton program under the current farm bill was effective through the 2007 crops. The new farm bill, then, needs to cover the 2008 and succeeding crops. However, farmers won't harvest their 2008 cotton for another five or six months, so they don't need to worry about 2008 price support loans until they actually harvest a crop to put under loan. The same is true for many other core farm programs, those for wheat, corn, other feed grains, oilseeds, cotton, rice, sugar, peanuts, and pulses.

In contrast, throughout the Nation dairy cows are producing milk every day of the year, and so the price support program operates on a day-to-day basis. And, without the short-term extension, as of this morning, the current farm bill dairy program would have ceased operation and processors would no longer have been able to sell butter and milk powder to the government under the program. Similarly, the nutrition programs, credit programs, research and extension operations, and other farm bill programs operate every day of the year, so that the one-week extension of current farm bill programs to April 25 was critical.

CONFERENCE WORK: It is safe to say that most of the work on the new farm bill is finished, witness the conferees' approval of several titles this week. And, there are not a lot of stumbling blocks preventing final passage.

These include nutrition program funding. Both the Senate and House versions of the farm bill proposed increases in funding for nutrition programs, a timely move given upward pressure on food prices this year. Recently, however, the House leadership proposed a larger increase than had been agreed to so far in conference. According to the most recent reports, the conferees are willing to accomodate that desire by adding $500 million more to nutrition programs.

The Senate has been pushing for a new farm permanent disaster assistance program that would cost about $5 billion. This week, it appears, both sides gave ground on this, with the House conferees offering to accept a $2 billion program and the Senate reducing its proposal to $4 billion; but, needless to say, that means they are still far apart.

The Senate tax credit initiative would add a package of $2.5 billion in credits to the farm bill. So far, the House is only willing to go for $1 billion in credits, and as of yesterday was questioning whether what the Senate had proposed would cost $10 billion not $2.5 billion.

The final big open issue is how to fund farm bill increases. Both houses of Congress want to ensure that any new farm bill spending doesn't add to the Federal budget deficit; so a number of "offsets" have been proposed for inclusion in the farm bill. The offsets would either increase Federal revenues or decrease spending in some other Federal programs. Too many have been proposed to list them all here, but the point to be made is that the House and Senate have yet to settle on a list of ones that they can agree on and that the Administration is comfortable with as well.

As the new week dawns, then, the open question is: Will the seven days of additional time the short-term extension bought enable Congress to come to a meeting of the minds on these difficult issues?  

News

Environment

[11/14] NY pet cemetery ranked among Taj Mahal, pyramids
[11/13] Man arrives at bar with pet alligator; cops called
Read More

Web Resources

United States Department of Agriculture
FindLaw
Thomson West
U.S. Courts
Westlaw
United States Chamber of Commerce
FirstGov
Legislative Branch
Library of Congress
White House
Internal Revenue Service
National Weather Service
Yahoo!Maps
YellowPages.com
New York Times
Newspapers Online
USA Today
Wall Street Journal
AOL
Google
Yahoo!Legal Blog Directory