House Panel Clears Farm Bill

May 15, 2013 09:56 PM

via a special arrangement with Informa Economics, Inc.

Bumpy road ahead when bill gets to House floor

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

The House Agriculture Committee late Wednesday approved its $940 billion farm bill version, 36-10, following nine hours of debate throughout the day on key policy issues including nutrition spending, dairy policy and food regulation. The measure (HR 1947) now moves to the House floor where it is expected to be considered in June, but before July Fourth recess. The Senate Agriculture Committee approved its $955 billion version of the bill Tuesday, and the full Senate is expected to start work on the bill Monday, May 20. Many existing farm programs expire Sept. 30.

Two GOP panel members voted no. Two Republicans, Bob Goodlatte of Virginia and Bob Gibbs of Ohio, voted against the House farm bill.


House Ag Committee Chairman Frank Lucas (R-Okla.) praised the efforts of the panel in passing the bill, but warned that there was still a lot of work ahead as the measure headed to the full House. "I’m pleased the committee was able to work together, find some common ground, and advance a five-year farm bill today," Lucas said. "This is an adventure that began two years ago," said Chairman Frank Lucas, "and we have an adventure ahead of us in June."


The House bill cuts projected spending in farm and nutrition programs by nearly $40 billion over the next 10 years. Just over half, $20.5 billion, would come from cuts to the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps. The Senate voted to cut spending by $23 billion, with $4.1 billion of the cuts coming from the food stamp program. Rep. Jim McGovern (D-Mass.) said, "This farm bill is not worth advancing if there is a $20 billion cut in SNAP. There are some people who think we ought to just go along with this, even though we don’t like it. But my view is that if we do that, we have no leverage in conference."

Both House and Senate bills would eliminate the around $4.9 billion direct payments to farmers, which are made annually whether they grow crops or not. Billions of dollars saved by eliminating direct payments would be directed into other subsidy programs, including crop insurance and a two-year transition payment for cotton. The farmer safety net programs include revenue assurance and target prices.


The House debate included a cleared amendment pushed by Rep. Steve King (R-Iowa) that would bar states from setting production standards for foods brought in from other states. The amendment is aimed at blocking California and other states from imposing standards such as regulations on the size of hen cages that farms in other states must meet.


Catfish amendment approved. The panel also approved, 31-15, an amendment by Rep. Vicky Hartzler (R-Mo.) to repeal USDA's authority to inspect catfish.


COOL amendment withdrawn. Rep. Austin Scott (R-Ga.) offered but then withdrew an amendment to eliminate country-of-origin labeling (COOL) for meat after the committee has agreed to review the law and its impact on trade. Rep. Kristi Noem (R-S.D.) said, "I know there have been bumps along the way" to implementation, but consumers deserve to know the origin of their food.

GIPSA amendment on livestock marketing regulations. An approved amendment would kill the livestock marketing regulations that USDA's Grain Inspection, Packers and Stockyards Administration (GIPSA) issued after passage of the 2008 Farm Bill. GIPSA withdrew some of the regulations but has been blocked by appropriations riders from implementing remaining rules that would provide protections for poultry producers. The amendment by Rep. Mike Conaway (R-Texas) was adopted on a voice vote after Peterson indicated his support, saying it would be a lesson to USDA not to "overreach."


Key dairy amendment fails. The Ag panel voted down, 20-26, a dairy amendment by Reps Goodlatte and David Scott (D-Ga.) that would have deleted supply management language from the dairy reform program. For dairy farmers, the bill would create a margin protection program that would provide payments when dairy margins fall below $4 for a two-month period, with supplemental coverage available when margins drop below $8. The bill also would establish a market stabilization program to prevent an oversupply of milk, which would take effect when average margins fall below $6 for two months or $4 for one month. The Goodlatte-Scott amendment would have replaced the stabilization program with an option for farmers to enroll annually in a new margin insurance program at levels of $4 to $8 in increments of 50 cents. The stabilization program "directly interferes in dairy markets," Scott said before the vote defeating his co-authored amendment. "What we are trying to do is take the volatility out of the system," said ranking Democrat Collin Peterson of Minnesota.

Jerry Slominski, of the International Dairy Food Association, in a statement, said: "We expect that the Goodlatte-Scott amendment will be brought to a floor vote and that the House will ultimately take a strong position against a supply management policy that would restrict job growth, hurt middle-income families and add additional costs to nutrition programs that are losing funding in the Farm Bill. Also, the Goodlatte-Scott amendment would cost taxpayers less than the Dairy Security Act, according to the Congressional Budget Office."



Comments From House Ag Panel Members During Dairy Policy Debate


Rep. Collin Peterson (D-Minn.): "And I just want to talk about the economics of the dairy industry a little bit more. A 2 percent oversupply in milk will collapse the system. We’ve seen that. That’s all it takes, is 2%. It means we can’t sell it in the U.S. and we can’t export it in the world market. If you get into that kind of a situation, the bottom falls out…Now, back in ’09 that problem was caused, to some extent, by the financial collapse and what happened within the economy at the time, and demand for dairy, for a lot of different things, went down, including dairy products. So we had an increase in production and we had a decrease in demand; it collapsed the market. And as Mr. Costa said, we had I don’t know how many bankruptcies. I don’t know how much equity was lost. It was a disaster. And if we get into that situation again, we’re going to lose 25% of the dairy farmers in this country."


Rep. Bob Goodlatte (R-Va.): "And yes, the prices fluctuate. Farmers have to deal with that and consumers have to deal with that. They make the decision whether they’re going to be consuming something or not consuming it based on the price. If you consistently attempt to fix the price based upon controlling the supply of the herd, it hurts farmers because they will not be able to grow, they will not be able to plan, they will not be able to tell new markets that they can consistently supply those markets, and it hurts consumers."


Rep. David Scott (D-Ga.): "I’ve listened to this, and I want to make a couple of points clear on the pricing. The CBO clearly states that under the language of the supply management program the price of milk will go up. And when you calculate in inflation, it could go up, over the next period of time before we get back to the next farm bill, just this cost for the supply management, up to 50 cents."


House Ag Chairman Frank Lucas (R-Okla.): "In all respect, you have to vote your conscience, of course. But a farm bill is like a giant jigsaw puzzle. You have many pieces that have to fit together in order to create that final product. I am in good faith opposing one friend’s amendment and sustaining another friend’s work. I have to move that puzzle forward…I believe the base text is the best opportunity to complete that. Vote your conscience, but remember, we have to have a farm bill when all this is over with."



 A major debate during during the markup session came on an amendment that would have removed the $20.5 billion reduction in SNAP funding from the bill. Very impassioned remarks were heard on both sides of the issue with the debate taking many winding and twisting turns over the course of more than an hour before the vote. The measure failed on a 17-27 vote.

The existing US sugar program was kept intact in both the House and Senate farm bills.

The House bill provided additional funding to support fruit and vegetable growers, and restores insurance programs for livestock producers, which had expired.

Among efforts included in an en bloc amendment was one that would require EPA to consult with USDA on regulations that could significantly affect agriculture with USDA analyzing the impact of the regulations.

Organic products amendment. The House Ag panel also backed an amendment from Oregon Democrat Kurt Schrader that would authorize USDA to establish an industry-funded research and promotion program for organic products similar to existing "checkoff" programs for milk, beef and many other foods.


Rural renewable energy and biofuel programs. Unlike the Senate bill, the House version would not include mandatory funding for rural renewable energy and biofuel programs.

Comments: By far the biggest hurdle ahead is the House floor debate. The measure is expected to pass the Senate chamber, which may put up a 60-vote hurdle for some if not most offered amendments. In the House, the battle will be over food stamp cuts and dairy policy, with Republican leaders showing a keen interest in both topics. House Speaker John Boehner (R-Ohio), who has never voted for a major farm bill during his career, has been an active opponent of supply management language in the proposed dairy reform package included in both the House and Senate versions. Sources say Boehner has talked to several House members about the matter. House Majority Leader Eric Cantor (R-Va.), meanwhile, wants to push a food stamp amendment that would generate still more savings from the program. Also, Cantor's district bumps up against the district of Rep. Goodlatte, who actively pushed an alternative to the supply management dairy language. The vote count in the House will be between how few Democratic members vote for the bill due to the considerably higher cuts for food stamps, and how many Republicans vote for the measure. The Republican vote count in part will be determined by whether or not an expected amendment to delete the dairy supply management language is successful. If not, then the final vote tally on the floor would be in the uncertain category, according to veteran farm bill contacts.


NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.






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