As expected, the Senate easily approved a new five-year farm bill today, officially called the Agricultural Act of 2014, by a vote of 68-32. The House passed the measure last week. President Barack Obama is expected to sign the measure when it reaches his desk. So the focus now shifts to USDA and implementation of the new programs. For more on the reforms and changes of the bill, see "Farm Bill at End Zone: What Farmers Need to Know and Do" and "2014 Farm Bill Key Features and Lessons."
Following are some responses to farm bill passage from various groups and individuals of significance in the ag sector.
House Ag Committee Chairman Frank Lucas (R-Okla.):
"I am pleased the Senate passed the conference report and put us another step closer to enacting a new farm bill. I commend Chairwoman Stabenow and Ranking Member Cochran on their efforts throughout this process. We worked together to give certainty and sound policy to our agricultural producers; deliver taxpayers billions of dollars in savings; and provide consumers the affordable and reliable food supply they have grown accustomed to."
Senator Pat Roberts (R-Kan.), former ranking member on the Senate Ag Committee:
Roberts voted against final passage of the 2014 Farm Bill because "it goes backwards towards protectionist subsidy programs, instead of forward with innovative and responsible solutions for producers and the taxpayer."
In a speech Monday, he noted that legislation should be a whole sale rewrite of the programs and policies at USDA. He also said it should grab everyone in America's attention that "the entire House delegation from the wheat [Kansas] state was united in opposing this version of the farm bill."
"I understand that compromises were made, but I cannot support a bill that marches backwards towards producers making decisions based off of government subsidies, retaliation against our livestock producers, and once again agriculture taking a disproportionate cut in spending compared to federal nutrition programs," Roberts explained.
Roberts also said that Kansas producers said "over and over again their No. 1 priority and concern was the availability of crop insurance that protects in case of disaster ... They were also fully aware that direct payments would no longer be available to them, and most are okay with that direction. However, Kansas producers did not ask for a continuation of a target price subsidy program and they certainly did not want Congress to raise the target prices of all commodities."
"The new Price Loss Coverage (PLC) Program contained in this conference report sets high fixed target prices and subsidies for all commodities and regions of the country," according to Roberts, which he says will encourage producers to plant the crop that guarantees the highest subsidy payment from the government, not the market.
Roberts says this is a problem, because "When all producers in Kansas, and the rest of America, have the same price guarantees and signals to plant wheat and the majority make the business decision to follow subsidy signals instead of the market, over time there will undoubtedly be more production than global demand."
Besides having high fixed target prices, the new PLC program sets price guarantees so high that some are at or above the producer's cost of production, he notes. This would mean the government is essentially subsidizing a producers so he or she is guaranteed a profit if the grower has an average yield.
Roberts continues: "The early analysis that I have seen shows that the target prices are high enough that Rice, Peanuts, and Barley growers will receive a subsidy payment at least 75% of any given year; likely triggering a payment four out of the next five years. Other commodities are not treated as favorably, with wheat prices likely to trigger a payment on average only 35% of the time and soybeans less than 15%. What that tells me is that the new target price guarantees are set high enough for a few commodities to trigger subsidy payments with a high frequency."
Listen to or watch Roberts' remarks here.
PF Perspective: If Roberts' assessment is accurate (likely), World Trade Organization (WTO) challenges will likely be forthcoming.
Senate Ag Committee Chair Debbie Stabenow (D-Mich.)"
The bill represents rare bipartisan agreement on a major jobs bill, legislation that will help grow Michigan's agriculture economy, the state's second-largest industry. The 2014 Farm Bill reduces the deficit by $23 billion and represents the most significant reform of American agriculture policy in decades. The Farm Bill was approved by the House last week and will now head to the White House for the president's signature.
"This isn't your father's Farm Bill. It is a bill for our future that grows our agriculture economy, helps provide greater access to healthy Michigan-grown foods, preserves our land and water, and cuts unnecessary spending. The Farm Bill is a rare example of a major bipartisan jobs bill and a bipartisan deficit reduction bill," Stabenow said.
"We were also able to protect food assistance for families in need of support, while finding savings solely by focusing on fraud and misuse. We proved that by working together across party lines, Congress can save taxpayer money and strengthen critical investments that lay the foundation for economic growth," Stabenow continued. See more.
Senator Chuck Grassley (R-Iowa) -- voted against the bill:
"I’m extremely disappointed that my provisions to place a hard cap on farm payments and better define who can receive those payments were stripped down to such a great extent that they likely won’t have much effect. Unfortunately, a few members of the House and Senate placed parochial interests above the broader good for the agricultural community.
"Currently 10% of the wealthiest farmers receive 70% of the benefit from the farm program. This puts small- and medium-sized farms and young and beginning farmers at a disadvantage. These are the very people the farm program is supposed to help. The committee leaders negotiating the final bill struck my simple, common-sense and enforceable provisions from the final bill.
"As a farmer myself, I understand how a five-year farm bill helps with long-term planning, and there are some good things in the bill. But, I can’t turn a blind eye to a select few members dismantling a provision that was passed by wide, bipartisan majorities in both the House and the Senate."
USDA Secretary Tom Vilsack
"Today's action will allow the proud men and women who feed millions around the world to invest confidently in the future. Our communities will have additional support to attract new economic opportunity and create jobs. During difficult times, children, working families, seniors and people with disabilities will have access to nutritious food. The potential of new products, treatments and discoveries will be strengthened through new agricultural research. Renewed conservation efforts will protect our fields, forests and waters creating new tourism options. This legislation is important to the entire nation.
"Building on the historic economic gains in rural America over the past 5 years, this bill will accomplish those goals while achieving meaningful reform and billions of dollars in savings for the taxpayer. While no legislation is perfect, this bill is a strong investment in American agriculture and supports the continued global leadership of our farmers and ranchers."
Independent Community Bankers of America (ICBA):
"The Agricultural Act of 2014 includes several provisions that advance ICBA objectives to spur rural economic growth. In particular, ICBA appreciates provisions of the act to strengthen crop and revenue insurance programs and to remove term limits on USDA guaranteed farm operating loans, among other federal policies important to rural America. ICBA community bank members are prolific lenders to the agricultural and rural sectors of the U.S. economy."
PF Perspective: If ICBA supports the new farm bill, it's a sign that the measure is likely friendly for farmer financials.
The National Corn Growers Association President Martin Barbre:
"While it's not perfect, we're pleased to see the bill contains many provisions we've been working hard for over the years."
In particular, Barbre pointed out that the new legislation provides the farmers the option to participate in either the revenue-based Agriculture Risk Coverage program (with county or farm-level options) or a Price Loss Coverage program with fixed reference prices. The ARC will provide a band of coverage for 76% to 86% of the benchmark revenue.
NCGA also highlighted the following provisions of the new farm bill:
- Eliminates controversial direct payments while maintaining decoupled farm support programs that will minimize the possibility of planting and production distortions that could trigger new World Trade Organization challenges.
- Consolidates 23 previous conservation programs into 13, and focuses conservation efforts on working lands. It also ties conservation compliance for wetlands and highly erodible land to premium support for crop insurance.
- Maintains authorizations for important agricultural research programs, including AFRI, as well as including a new Foundation for Food and Agriculture Research that will provide a structure and mandatory funding for new public/private partnerships and investments that will further USDA's research mission.
- Maintains authorizations and funding levels for export promotion, including the Foreign Market Development (FMD) Program and the Market Access Program (MAP).
- Continues the combined authorization of both agricultural and nutrition programs, a linkage that has been essential in enacting every farm bill since 1974.
American Soybean Association President and Iowa farmer Ray Gaesser
"From day one, soybean farmers have been invested in passing a bill that provides comprehensive risk management while avoiding potential market distortions," added Gaesser. "We are confident that this bill accomplishes that, and we are very thankful to Chairwoman Stabenow, Chairman Lucas and Ranking Members Cochran and Peterson for their relentless persistence in driving this process forward and bringing the bill to the best possible conclusion."
In addition to the risk management framework, the bill also secures several other ASA priorities: agricultural research programs, including the Agriculture and Food Research Initiative (AFRI) and the new Foundation for Food and Agriculture Research (FFAR); export promotion done under the Foreign Market Development (FMD) and Market Access Program (MAP) on which soybeans depend as the nation’s top farm export; and key energy programs, including the Biodiesel Education Program and a strengthened Biobased Markets Program. Additionally, the bill consolidates 23 previous conservation programs into 13, while focusing conservation efforts on working lands.
Center for Rural Affairs:
"Sadly, the back-room deal struck in Conference Committee rejects the bipartisan farm subsidy reform that was included in the farm bills passed in both the House and Senate," said Traci Bruckner, Senior Policy Associate with the Center for Rural Affairs. "And the deal will result in virtually unlimited farm program payments continuing to inure to the nation's largest and wealthiest mega-farms."
American Farm Bureau Federation (AFBF) President Bob Stallman:
"The farm bill provides farmers and ranchers certainty for the coming year, allowing them to continue with their business of providing food and jobs for America. We are particularly pleased with provisions in the 2014 farm bill to provide risk management to fruit and vegetable farmers and to support livestock farmers during disasters.
"Farm Bureau now looks forward to bringing the legislation across the finish line with the president’s signature and working with USDA to get the new farm bill implemented as soon as possible."
The National Association of Counties (NACo)
The National Association of Counties (NACo) supported the final farm bill as it contains several critical county priorities including FY14 funding for the Payment In Lieu of Taxes (PILT) program, reauthorization of vital programs within the Rural Development title and protection of county authority over forest roads.
The conference report includes several NACo priorities on a broad range of programs that assist counties in the development of rural water-wastewater infrastructure, community facilities, broadband expansion, nutrition assistance, renewable energy, local and regional food systems, support for new farmers and business development initiatives. The farm bill would also codify the U.S. Environmental Protection Agency's (EPA) long-standing policy that specific silvicultural activities do not require National Pollution Discharge Elimination System (NPDES) permits.
The key elements of the farm bill that impact counties include the following:
- PILT program is extended as a fully funded, mandatory entitlement program at $425 million. PILT has retained full mandatory funding since FY08, with funding levels of $393 million FY12 and $401 million (after sequestration) in FY13.
- The Rural Development title receives $228 million in mandatory funding including: $150 million for Water and Waste Water Program; $63 million for the Value-Added
- Producer Grant Program; $15 million for the Rural Microenterprise Assistance Program (RMAP), and $100 million for the Beginning Farmer and Rancher Development Program.
- Regional language championed by NACo in the Rural Development title allowing the U.S. Department of Agriculture to prioritize 10 percent of funds towards regional, multi-jurisdictional projects.
- The Supplemental Nutritional Assistance Program (SNAP) is cut by $8 billion over 10 years. The Senate farm bill (S. 954) proposed $4.5 billion in cuts over 10 years; the House farm bill (H.R. 2642) proposed $40 billion in cuts over 10 years.
- The conference report preserves U.S. Environmental Protection Agency's long-standing policy regulating stormwater runoff from forest and logging roads under the states' Best Management Practices (BMPs), rather than through the Clean Water Act's (CWA) industrial stormwater permit program, which has tighter and more restrictive requirements than general CWA stormwater permits. This is a huge win for counties who own and manage 44% of the nation's roads and highways. A number of county-owned roads run through federal, state and private forest lands. Many of these roads are multipurpose and not solely dedicated to logging-and are used by residents, recreators, emergency responders and wildfire teams.