Farm Bill Digest #1

In this issue of the Digest:

Farm Bill Mark up Begins in the House
House Agriculture Committee Chair will release his full farm bill proposal today and subcommittee mark up will begin next week.

EQIP Farm Bill Proposals Disappoint
Several marker bills provide for significant increase in funding for the Environmental Quality Incentives Program without addressing serious payment limitation issues.

Diversity Initiative
Congressman Baca is expected to introduce a bill to address the barriers to participation in USDA programs for minority farmers.

Renewable On -Farm Energy Bills
Several marker bills have been introduced to promote on-farm energy production in the 2008 Farm Bill.

Competition Title Introduced
A number of farm bill marker bills address increasing concentration in the U.S. food processing and meat packing industry.

Beginning Farmer Initiative Introduced
Senator Harkin has introduced comprehensive legislation to address the many barriers faced by new farmers.

Nelson, Salazar Introduce a Major Micro Bill
Senators Ben Nelson and Ken Salazar have introduced a bill to create a rural microenterprise loan and grant program.

Food Security and Economic Opportunity
Two bills introduced this week expand economic opportunity for farmers by increasing access to healthy and fresh food to underserved markets.

Farm Bill Digest

Farm Bill Mark up Begins in the House
Collin C. Peterson, (D-MN) the chairman of the House Agriculture Committee is expected to release his full farm bill proposal today, May 18th. The House Agriculture Subcommittees will begin mark up of the Farm Bill next week with the subcommittee on Conservation, Credit, Energy, and Research leading off the process on May 22nd. Many agriculture committee members have introduced or sponsored individual marker bills that they hope to see included in the final farm bill. This first issue of the Farm Bill Digest summarizes some of those bills, focused, in particular, on bills that address or fail to further our farm bill priorities.

EQIP Farm Bill Proposals Disappoint
Several recently introduced Farm Bill proposals have proposed to significantly increase funding for the Environmental Quality Incentives Program (EQIP) without addressing serious payment limitation issues.

The Healthy Farms, Foods and Fuels Act (Kind Menendez H.R.1551/S.919), the Eat Healthy America Act (Cardoza H.R.1600) and the Farm, Nutrition and Community Investment Act, sometimes referred to as the Northeast Marker Bill (DeLauro H.R. 2144) all double funding for EQIP from $1 billion to $2 billion annually.

EQIP is a popular conservation program that provides incentive payments and cost share to farmers for addressing resource concerns on their farms. When EQIP was first passed in the 1996 Farm Bill, the law prohibited EQIP funds from being used to subsidize the construction or expansion of large Concentrated Animal Feeding Operations (CAFO). EQIP funds could not be used for waste storage and handling facilities for large CAFOs (more than 1000 animal units) or for expanding CAFOs. This prohibition was removed in the 2002 Farm Bill. Also in 2002, the $50,000 payment limitation was raised to an exorbitant $450,000. Participants receiving payments under multiple contracts can exceed the $450,000 payment limitation.

Since 2002 hundreds of millions of dollars of EQIP funding have been used to subsidize CAFO construction and expansion. While increased funding for this program is welcome it must include reasonable and responsible payment limitation reform. The 2008 Farm Bill should impose a payment limitation of $150,000 for EQIP contracts and reinstate the ban on funding for waste storage and handling infrastructure for large or expanding CAFOs.

Diversity Initiative

African Americans, American Indians, Asians and Hispanics own some 25 million acres of U.S. farm land. Latinos and women farmers are two of the most rapidly growing sectors in U.S. Agriculture. Yet, the participation rates of these groups in USDA programs lags well behind that of non-minorities.

Congressman Joe Baca (D-CA) is expected to introduce a bill this week that would address the barriers to minority participation in farm credit, marketing, risk management, conservation and other USDA programs. The Baca Bill is expected to increase funding for the Section 2501 Outreach and Technical Assistance Programs for socially disadvantaged farmers and ranchers. It would create a comprehensive program to increase the participation rates of minority and women farmers. It also strengthens USDA reporting requirements to allow the public to track participation rates based on race, ethnicity and gender.

Renewable On -Farm Energy Bills

Senator Amy Klobuchar (D. MN) introduced the Farm to Fuel Investment Act, (S. 1403) on Tuesday May 15th. The bill directs the Secretary of Agriculture to designate bioenergy cropsheds within a 50 mile radius of existing or proposed biorefinery facilities. Producers in those cropsheds can receive incentive payments for the production of bio-energy crops if they promise to achieve certain water quality, wildlife habitat and soil quality criteria by the end of the contract. Bio-energy crops are perennials or annuals if part of a resource conserving crop rotation. All program crops and residues those crops eligible for direct payments and sometimes referred to as Title I crops, are ineligible. The bill also provides for a new enhancement payment under the Conservation Security Program for establishing bioenergy crops that incorporate two or more native perennial species. Enhancement payments are also available for producers that participate in research and demonstration projects to advance best practices around bioenergy crop production.

Senator Baucus (D-MT) has introduced the On Farm Energy Production Act of 2007 (S.828) amending the Environmental Quality Incentives Program to provide cost share for farmers producing energy on-farm using solar energy, wind energy and renewable fuels. There is a $50,000 payment limitation on the cost share payments.

Congresswoman Stephanie Herseth Sandlin (D-SD) along with Congressman Fortenberry (R-NE) and Congresswoman Kaptur (D-OH) have introduced the Rural Energy for America Act of 2007 (HR 2154). The bill expands the size and scope of the §9006 clean energy program passed in the 2002 Farm Bill. The current program supports loans and loan guarantees to farmers, ranchers and small businesses to purchase renewable energy systems and to make energy efficiency improvements. The Herseth bill proposes a massive ramping up of funding for the program to $250 million by 2012 from its current $23 million per year. It also boost loan guarantees for cellulosic ethanol facilities to $100 million per project.

Competition Title Introduced

Concentration in the U.S. food processing and meat packing industry continues unabated. On May 7, the U.S. Department of Justice approved the proposed takeover by Smithfield Foods, the nation's biggest pork packer and feeder of its number 2 rival, Premium Standard Farms. Like many other processing firms, these two packers have become major producers of fed livestock in direct competition with family farmers. Their market share from the livestock they produce themselves and livestock they control under producer contracts allows them to exert significant control over market prices. In addition to manipulating prices, the packers impose provisions in their production contracts that unfairly shift significant financial risks and impose heavy capital investment requirements upon producers.

Several Bills have been introduced that would restore open and competitive markets:

• The Agricultural Fair Practices Act introduced by Chairman Harkin (D. IA) S.622 would set minimum standards of fairness for producer contracts with respect to contract termination, investment requirements, confidentiality, and transparency; ensure the collective bargaining rights of farmers; and clarify the definition of "undue pricing preferences" in a manner that protects small and mid-sized producers from pricing discrimination. Congressman Boswell (D-IA) has introduced the measure in the House, HR 2135.
• S.305 introduced by Senator Grassley (R-IA) amends the Packers and Stockyards Act to prohibit Packer ownership and control of livestock.

Prohibiting packers from owning and feeding livestock would inhibit packer price manipulation.

The House Subcommittee on Livestock, Dairy and Poultry will begin mark up on the 2008 Farm Bill on May 24. Organizations are needed to sign on to a letter urging subcommittee members to include a competition title in the 2008 Farm Bill. For a copy of the letter and instructions for signing on go to: http://www.sustainableagriculture.net/HR2135.php To sign on, contact . The deadline for signing is 5PM Friday May 18th

Beginning Farmer Initiative Introduced

Senator Harkin (D-IA) introduced the Beginning Farmer and Rancher Opportunity Act of 2007, a comprehensive bill to address the needs of beginning farmers on Wednesday, May 16th. The bill enhanced technical assistance, cost share and incentives to beginning farmers participating in the Conservation Security Program or the Environmental Quality Incentives Program. It establishes a Beginning Farmer and Rancher Individual Development Accounts Pilot program to establish a matched savings account for the purchase of farm assets. The bill also proposes increasing the loan limit on Farm Services Agency direct farm ownership and operating loans from $200,000 to $300,000 to reflect the rising cost of farmland. Congresswoman Stephanie Herseth Sandlin (D-SD) has introduced the measure in the House (HR 2358).

Nelson, Salazar Introduce a Major Micro Bill
Senator Ben Nelson (D-NE) and Ken Salazar (D-CO) have introduced the Rural Entrepreneur and Microenterprise Assistance Act (S. 566) that establishes a $50 million, rural microenterprise loan program to make loans and grants to microenterprise development organizations that provide training, technical and financial assistance to rural entrepreneurs and small businesses. The organizations must have a demonstrated record of delivering services to economically disadvantaged micro-entrepreneurs or an effective plan to develop such a program.

Food Security and Economic Opportunity
Two bills introduced on May 17, expand economic opportunities for farmers and ranchers in local and regional markets by providing increased access to healthier food to underserved communities. The "Local Food and Farm Support Act" was introduced by Congressman Earl Blumenauer (D-OR). The bill includes a "Healthy Food Enterprise Program," a loan and grant program designed to encourage the the development of processing and distribution infrastructure serving local and regional agricultural producers. The program is aimed at increasing the availability and affordability of healthy and fresh foods, especially in schools and underserved communities. The bill also include support for the Value Added Producer Grant program which makes planning and capital grants to producers for projects that add value and income to their farming operation.

A comparable bill in the Senate, "FOOD for a Healthy America Act," will be introduced by Sherrod Brown (D-OH) and Hillary Rodham Clinton (D-NY). The Brown bill, however, will include a controversial provision regarding the federal Farm and Ranchland Protection Program (FFRP). FFRP provides funding for farm and ranchland conservation. The controversial provision eliminates the federal standard for "impervious cover. " Current law limits impervious cover on farm conservation projects funded by FRPP to 2-6%. The Brown bill would allow states to set their own standard. Many in the conservation community are concerned that some states would approve wall to wall greenhouses or livestock confinement facilities on "conserved" land.

Web Messaging
The Farm and Food Policy Project (FFPP) has launched a farm bill advocacy mini-website at www.healthyfarmbill.org/ . Visitors to the site can send a general message of support for its "seeking balance in U.S. Farm and Food Policy" campaign to their Congressman and Senators.

© 2007-2008 National Campaign for Sustainable Agriculture.