Ag Policy Update–13 MAR 02        

(Sunup Program to be aired 14 MAR 02)

 

 

1.     The farm bill debate continues in Congressional conference.  What’s the latest?                                                            

 

–Both the Senate Ag Committee Chair Harkin and House Ag Committee Chair Combest have now stated that a good bill is more important than a quick bill.

–Conferees met late yesterday to discuss their differences and how to get to a compromise.

–We’ll hear more in the next few days about whether the 22 Mar deadline can be met.

 

 

 

 

2.        Remind us again of why the date 22 Mar may be important?

 

 

–In order for the new legislation to be implemented to help 2002 crops, federal agencies said the new legislation needed to be signed by 22 Mar.

–However, all key parties have indicated there is a willingness to pass another year of emergency aid for farmers.  So the pressure for the 22 Mar deadline is mostly gone.

 

 

3.     So, let’s quickly run down some of the questions that producers are asking.  What needs to happen to get a new farm bill?

 

–A conference committee of House and Senate reps (11 Republicans and 10 Democrats) must agree on a single compromise of the House and Senate versions. 

–Once they agree, the compromise is sent to both the House and Senate for votes.

–If both pass the bill (and they likely will), it is then sent to the President for his signature.

–While he could veto it, that is very unlikely.

–Once his signature makes it law, the various federal agencies will write implementing rules and regs, allowing for public feedback.

 

 

 

 

4.        When will the new farm bill pass and when will it be implemented?

 

–Tough question.

–The Conference Committee has set a goal of 22 Mar, 8 days away.

–If Congress meets that deadline, the legislation could be implemented by June.

–If Congress doesn’t pass it until June, it could October or November before it is implemented.

 

 

 

 

5.     It’s all very hypothetical right now, but would happen if the election campaigns confused the issue and an new farm bill was not passed this year?

 

 

–There are provisions in the existing legislation to revert to permanent legislation.

–While this unusual, it did begin to occur when we didn’t pass a 1995 farm bill, and it was April 1996 before we got a new bill.

–Few would really want legislation that was crafted for 1938 and 1949.

 

 

 

 

6.        Summarize for us again what analysis is saying about a comparison of the House and Senate farm bills.

 

 

–Under the House bill, wheat farms with 30 bushel yield don’t hit the payment limit until they are about 3700 acres in size for single entity & 7400 acres for 3 entity.

–Similar farms under the Senate version hit the payment at about 5500 acres for a single producer, and 5600 acres for an eligible married couple.

–The upper limit size increases as prices increase.

–OSU analysis and FAPRI show the House version paying more to producers through commodity program participation than the Senate, while the Senate pays more through conservation programs.

–Since the total pot of money is the same in both bills, the issue is not how much each spends.

–Instead, the issue is one of distribution of support among commodities and between commodity and conservation programs.

–Depending on your assumptions, it seems that larger wheat farms will get more from the House version, while more farms will get funds from the Senate version.

 

 

 

 

 

 

 

 

 

 

7.     You indicated that Harkin recently made public statements about the content and process.  Can you summarize his view?

 

 

–He acknowledges there are few differences in trade, nutrition, research and forestry.

–He noted his strong bipartisan support for his rural development and conservation titles.

–He acknowledged there are sharp differences in commodity program provisions and opened the door for compromise there.

–He also emphasized the areas that may be most difficult are the payment limitations and packer ownership ban.

–While there is strong bipartisan support in the Senate for payment limitations, it is very thin for the packer ownership ban.

–House Ag Committee Minority Leader Stenholm is working behind the scenes on a compromise payment limitation.  Cotton and rice farms could be the hardest hit by the Senate limit.

–Stenholm also suggested the compromise for the packer ban be a study.

 

 

 

 

 

8.        Other policy-related news:

 

a.     USDA Secretary Veneman has selected Cotton Board members, including the reappointment of Altus producer Clint Abernathy.

 

b.     Reports continue to suggest the economic recession is at or nearing an end.  Retail sales are up slightly.  Some see the Congress finally dealing with an economic stimulus as helping those out of work and strengthening the rebound.

9.        Congress:

 

a.        Recent activity:

–Senate Ag Committee considered several USDA appointments (6 Mar)

–House Ag Appropriations subcommittee reviews USDA farm and foreign ag services (13 Mar)

 

b.        Current/upcoming:

–Several committees have initiated investigations of various aspects of the Enron scandal.

–House-Senate conference on farm bill continues with informal meetings of staffers

 

c.        2002 Schedule:

–As of Monday 18 Mar, there are 102 working weekdays in this session.

–Target adjournment 4 Oct

 

d.        Key issues:

–Trade Promotion Authority

–New farm bill

–Bioterrorism & homeland defense

–Healthcare reform

–Prescription drug benefits

–Corporate & retirement plans reform/oversight

–Campaign Finance Reform

–Merger activities, especially in agriculture

–Economic stimulus

 

 

 

 

 

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