Issue Position: Agriculture - 2002 Farm Bill

Issue Position

The House of Representatives recently passed H.R. 2646--the Farm Security and Rural Investment Act of 2002, otherwise known as the 2002 Farm Bill.

The House Agriculture Committee, of which I was a Member, undertook an extensive effort to hear directly from commodity organizations, farmers, bankers, communities, and other interested parties over 2 years in preparation for the re-write of the 1996 Farm Bill. Through a series of hearings, most of which I participated in, the House Agriculture Committee required commodity groups to provide specific, detailed information about their recommendations for improvements to the Farm Bill. I am proud that, based on these recommendations, we were able to craft a bill that enjoys the support of virtually every major commodity group in the nation, including those representing the vast majority of Idaho's primary commodities including wheat, barley, sugar, beef, honey, potatoes, wool, and a myriad of other crops.

While no piece of legislation is perfect, I believe this measure will provide a firm footing for agriculture over its six year life. It will pump an additional $7.4 billion per year into rural America, boost farmer income, create new opportunities for rural communities, expand research and nutrition programs, help foster new construction of ethanol facilities, and provide additional resources for many important conservation initiatives. In short, this legislation is an economic stimulus package aimed predominantly at the sector of our economy suffering the worst--agriculture.

Among its many provisions, the Farm Security and Rural Investment Act will:

* Maintain maximum planting flexibility;

* Retain fixed-decoupled payments for program crops including wheat, barley and canola. ($.52 for wheat, $.24 for barley);

* Retain the marketing loan program with slightly higher loan rates;

* Create a new counter-cyclical safety net program based on a target price; ($3.86 for wheat, $2.21 for barley)

* Allow producers to either update or maintain their current base acres;

* Set payment limitations at $40,000 for the fixed decoupled payments, $65,000 for counter-cyclical payments, and $75,000 for marketing loan gains and loan deficiency payments. The total dollar limitation is reduced to $360,000 in the new farm bill;

* Eliminate the sugar marketing assessments and the one-cent per pound loan forfeiture penalty. Establish quota allotments for sugar production;

* Extend the milk price support program at $9.90 per cwt through 2011;

* Create a marketing assistance loan for honey producers with a loan rate of $.60 per pound and marketing assistance loan program for wool and mohair;

* Establish marketing loans and loan deficiency payments for Dry Peas, Lentils, and Small Chickpeas;

* Retain planting restriction of fruits and vegetables on base acres;

* Provide an additional $200 million in spending authority per year for surplus commodity purchases of fruits and vegetables;

* Increase spending on the Market Assistance Program (MAP) from $90 million/year to $200 million/year by 2006;

* Provide an average of $1.7 billion increase per year in new conservation spending;

* Increase the Conservation Reserve Program from 36.4 million to 39.2 million acres;

* Increase spending on the Environmental Quality Incentive Program (EQIP) $200 million/year to $1.3 billion/year with livestock producers receiving 60 percent of annual funding and crop producers receiving the remaining 40 percent;

* Provide $240 million for the Value-Added Grants Program to provide grants for start-up farmer-owned value-added processing facilities;
* Provide $80 million for improving local channel access over satellites in rural areas;

* Provide $100 million for improved broadband access in rural areas;

* Provide $360 million for rural water and wastewater treatment facilities;

* Provide $100 million for rural business development;

* Establish a new Country of Origin labeling program for fruits & vegetables, meat, fish and peanuts. The first two years of the program would be voluntary after which the program will become mandatory. For a commodity to be labeled USA Product, it must be born, raised, and processed in the United States.

In addition, we were successful in defeating an attempt by Nevada Senator Harry Reid to include language that would have allowed the federal government to use Conservation Reserve Program funding to purchase water rights. For many of us in the West, the inclusion of such a provision would have forced us to vigorously oppose the entire bill and work toward its defeat. The Farm Bill is no place to set such a dangerous and misguided precedent and I am grateful then House Agriculture Committee Chairman Larry Combest (R-TX) heard our plea and rejected Senator Reid's attempt to allow the purchase of water rights.

The final bill did not, however, contain language sought by the Senate to ban the ownership of cattle by stockyards beyond 14 days prior to slaughter. The conferees agreed to study the issue for the remainder of the year, hold hearings on the impact of such legislation, and act on the issue only after the problems and possible solutions are more fully understood. I look forward to participating in those hearings in the very near future.

While this bill will help address many of the dire economic realities facing American agriculture over the next six years, it cannot address every need of every citizen who works and lives in rural America. I strongly believe we need to remain focused on ways in which we can strengthen existing programs within the USDA to better meet the needs of both producers and consumers.

Beyond the issues addressed specifically by the Farm Bill, I am also committed to addressing the concerns of Idaho's farmers and ranchers as they relate to taxes, trade, regulations, and input costs. One of the central tenets of Freedom to Farm was that Congress would provide agriculture producers with tax and regulatory relief and work to break down trade barriers abroad. Unfortunately, the federal government has not lived up to its promises and agriculture producers have suffered as a result.

It is extremely important that we act soon to address the tremendous trade barriers facing American agriculture and the unfair subsidies available to our competitors. That is why Senator Larry Craig and I are Co-Chairs of the Trade Caucus for Farmers and Ranchers. We are committed to ensuring that this important Caucus will advocate the interests of agriculture as our nation negotiates regional and worldwide trade agreements. Regrettably, we've too often seen American agriculture getting the worst end of trade agreements, while other American industries have received much better treatment.

We need to focus a great deal of attention over the next year on eliminating some of the crippling taxes that have been placed on agriculture producers. First and foremost, I want to see a permanent elimination of the "Death Tax" and full deductibility of health care expenses for self-employed individuals, like farmers and ranchers. I would also like to see a reduction or elimination of capital gains taxes and the establishment of FARM Savings Accounts. Finally, I recently became a cosponsor of legislation that would prohibit the Internal Revenue Service from collecting self-employment social security taxes from Conservation Reserve Program (CRP) income. I hope we can pass each of these common sense initiatives in the coming weeks and months.

I am committed to reducing the impact of burdensome regulations on farmers and ranchers and bringing down the dramatic rise in input costs over the past few years. Time and again, farmers and ranchers have been promised that the federal government would work to reduce the cost of regulations on American agriculture. Instead, under the Clinton Administration, the impact of regulations grew worse and input costs skyrocketed. Ill-conceived regulations like those on Total Maximum Daily Loads (TMDLs) and Concentrated Animal Feeding Operations (CAFOs) present an enormous challenge to the sustainability of family farming and ranching.

Furthermore, the federal government's inability to plan for the future energy needs of our nation has placed new burdens on American agriculture by dramatically increasing the cost of gasoline, diesel, natural gas, and fertilizer. Something must be done to reverse this trend immediately. I am advocating a new look at bio-fuels, including the expanded production and use of ethanol and biodiesel. Ethanol, biodiesel, and other domestically grown renewable energy sources hold great potential for the value of agriculture products and the economies of rural communities.

These are just a few of the issues I will be considering and advocating as we move forward to help America's farmers and ranchers through these difficult times. I am committed to meeting the challenges facing American agriculture, and I look forward to working with Idaho's farmers and ranchers to ensure the culture, traditions, values, and way-of-life so important to rural Idaho are preserved for generations to come.

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