The House Farm Bill Begins to Take Shape
Apr 19, 2018
Rep. Mike Conaway (R, TX), chairman of the House Agriculture Committee, held a mark up of his draft farm bill on Wednesday, April 18th. During his press conference to launch the bill on April 12, he described the bill as ‘bipartisan except for one title,’ but the changes to the Supplemental Nutrition Assistance Program (SNAP) that he is proposing have generated strong opposition from the Democratic members of the House of Representatives as well as nutrition advocates from outside of Congress. That attitude was reflected in the motion to report the bill out of Committee yesterday, which passed on a party-line vote of 26-20. It is quite clear that Mr. Conaway will be relying largely on Republican votes when he tries to get his bill through the House floor later this spring.
Due to lack of additional funding provided from outside the Committee, this proposed farm bill is basically a budget-neutral bill over the full ten year period estimated by the Congressional Budget Office (CBO), although it does shift about $3 billion from the second five year window (2024-2028) into the first five year window (2019-2023) that the farm bill will actually be in effect, if enacted. Total spending for all farm programs is projected to be $387 billion for the first five years, a 20 percent decline compared to the outlays projected for the 2014 farm bill, primarily due to reduced spending on SNAP due to an improved economy.
This blog will focus on changes in the four most expensive titles of the farm bill, from the perspective of mandatory funding provided for the various programs in each--nutrition, crop insurance, commodities, and conservation. The main provisions in the other seven titles will be discussed in a subsequent blog, with one exception. This blog will also discuss the national animal disease preparedness and response program, primarily the establishment of a livestock vaccine bank, which was included in the miscellaneous title. This provision was the major request by livestock groups to the House and Senate Agriculture Committees for this upcoming farm bill.
In the nutrition title, GOP efforts to impose more stringent work requirements and tighter rules regarding energy assistance on SNAP recipients and making it more difficult to sign up families to for benefits by narrowing what other safety net programs allow automatic enrollment for SNAP (called categorical eligibility) were the main reasons that House Agriculture Committee Democrats declared their opposition to the chairman’s draft bill. On the other hand, it does include a few provisions which make it somewhat easier to qualify for SNAP, by raising the deduction on earned income and requiring all states to allow recipients to exclude their child care expenses from calculations to determine program eligibility.
Lacking additional funding, the commodities title maintains the same major commodity support programs that were established in the 2014 farm bill (or earlier farm bills)--the Price Loss Coverage (PLC) program, a price-based support program providing payments to producers when market prices fall below fixed reference prices for each covered crop. It also maintains the Agricultural Risk Coverage (ARC) program, and allows producers to ‘plug in’ substitute T yields for low yields in their production history to stabilize their ARC guarantee, and allows the PLC reference prices to be substituted in for low market prices in calculating the national moving average price for determining payments under ARC. As was the case with the 2014 farm bill, farmers will have to make a one-time decision as to which of these programs to participate in for the lifetime of the next farm bill. In addition, farmers who suffered from extended droughts between 2008 and 2012 are also allowed to update their program payment yields. The addition of ‘seed cotton’ as an eligible commodity and the modifications to the dairy Margin Protection Program (MPP) made possible by the February budget deal, were incorporated in the farm bill, and the sugar program was unchanged. The title also includes provisions making it easier for large, and/or corporately-organized farming operations to collect higher levels of program payments.
The crop insurance program was little changed in this bill, reflecting the strong satisfaction that most insured farmers have in the program. The basic administrative fee charged for farmers using catastrophic insurance coverage (CAT) was increased from $300 to $500. The title also eliminated mandatory funding for risk management education programs that had been in place since 2000.
The conservation title includes several key changes. Most notably, it would eliminate the Conservation Stewardship Program (CSP), folding some its principles of looking at all resource concerns on a farm into a portion of the Environmental Quality Incentives Program (EQIP). This decision saves $12.6 billion in spending on CSP over a ten-year period that would otherwise occur, and $7.7 billion in funding over the same period is added to EQIP. The Agricultural Conservation Easement receives $2.2 billion in additional funding, and the Regional Conservation Partnership Program gets $1.3 billion in additional funding. The acreage cap for the Conservation Reserve Program is raised to 29 million acres by the end of 2023, from the current 24 million acres cap. This would largely be paid for by capping the payment rates that can be paid to enroll land in the CRP, at no more than 80 percent of the applicable county rental rate for cropland. This provision could make it less attractive to enroll conservation buffers and land for other specialized conservation activities.
Livestock producers gave up the provision that gave them at least 60 percent of the funding under the EQIP program for manure management activities. In exchange, they received $425 million in funding for ‘National Animal Disease Preparedness and Response’ over ten years, which will be used primarily to establish a vaccine bank to protect the U.S. livestock sector against the outbreak of diseases either deliberately introduced (through acts of terrorist) or spread accidently. These provisions appear in the miscellaneous title of the bill.