CONCERNS GROW THAT FARM BILL WILL EXPIRE
If you checked in with us last week, you might have heard the IL Corn Executive Director tell us that there’s a risk farmers might lose trade program funding if the Farm Bill expires on September 30. Check out this article from Politico today to see what else you might be risking.
What deadline? Concerns grow that farm bill will expire
By Catherine Boudreau and Helena Bottemiller Evich | 09/24/2018 05:08 AM EDT
Farm bill negotiators have less than a week to hash out their differences in the sweeping agriculture and nutrition legislation, with each passing day increasing the likelihood of missing the Sept. 30 deadline.
The leaders of the House and Senate agriculture committees have been meeting in person or over the phone for months to work out a conference version of the $860 billion measure, H.R. 2 (115). Yet significant disagreements remain over how to pay for and structure the largest programs, involving commodity supports, food stamps and conservation.
Passing an extension of current law isn't yet being considered, according to sources familiar with the talks. Punting until closer to the New Year — when a new Congress begins — is politically risky for farm-state Republicans vying to keep their majority in the midterm elections, as some constituents will hold them responsible for failing to reauthorize the law on time.
"I know both House and Senate ag leadership are very aware of the midterms coming up," Dale Moore, acting executive vice president of the American Farm Bureau Federation, told POLITICO. "I will simply say that's part of getting a farm bill done. There's political risk all the time."
Both Senate Agriculture Chairman Pat Roberts (R-Kan.) and ranking member Debbie Stabenow (D-Mich.) recently suggested an extension may not be needed until December, ostensibly because commodity policy wouldn't revert to decades-old law until January. Other big-ticket items like crop insurance and the Supplemental Nutrition Assistance Program are permanently authorized. Crop insurance is permanently funded and SNAP can continue with appropriated funding.
"The world doesn't end if we don't reach an agreement," Roberts told reporters last week. "It's in December when in fact you have to move. At that time then, you'd have to get an extension."
Roberts did acknowledge that producers would not be happy if Congress left Washington with work unfinished. "Farmers, ranchers, growers, they don't want that," Roberts added. "They'd like some certainty and predictability."
House and Senate leaders also are reluctant to talk about extending the current law out of fear of taking pressure off already slow-going negotiations. And if Congress doesn't pass a farm bill before the end of the year, both the House and Senate would have to reintroduce the legislation and vote again after the new session begins Jan. 3.
Appropriators could include an extension of the current farm bill in one of their fiscal 2019 spending packages. But many agriculture lobbyists doubt that will happen amid already sensitive spending negotiations and tight budget conditions. The House and Senate appropriations committees did not respond to requests for comment.
Without an extension, major conservation programs would be in budgetary purgatory. The Conservation Reserve Program and the Conservation Stewardship Program have mandatory funding, but USDA's authority to operate them expires at the end of the fiscal year.
"A lot of people say, 'Oh, it's only three or four months and then there will be an extension or a new farm bill.' But it takes a full year for most agencies to run their programs, between applications, field visits and awarding the funding," Ferd Hoefner, senior strategic adviser at the National Sustainable Agriculture Coalition, said. "If you jam them into a shorter period of time, [administrators] could make less well-thought out decisions. And then Congress will complain about not getting the funding out fast enough."
Advocates for dozens of lower-profile initiatives — those promoting international trade, local and regional food systems and bioenergy development, for example — are concerned their priorities will be left in the lurch if Congress lets the law expire without an extension.
The list of programs that would lose funding on Oct. 1, even if the farm bill is extended, is long. Although all together they made up less than 1 percent of the 2014 farm bill's projected price tag, NSAC has dubbed them "tiny but mighty."
The Value-Added Producer Grants Program is small - at $63 million over five years - but has wide reach. In 2015, those grants were given to a broad variety of local development efforts across the country, including projects to expand wine processing in Alabama; support a beef processing facility in Northern Iowa; and process and pack more pomegranates in California.
The program falls into a bucket of so-called orphan programs that don't have a mandatory budget baseline past the end of the fiscal year, which means lawmakers must find ways to pay to continue them. Baseline is an important benchmark because without it a program's price tag is scored as new spending. Other orphan programs include the Technical Assistance for Specialty Crops, Food Insecurity Nutrition Incentives, Biomass Crop Assistance Program and the Farmers Market and Local Food Promotion Program.
House and Senate Agriculture leaders have not said how they intend to handle such issues if the current law expires. POLITICO recently asked Stabenow what would happen to orphan programs if an extension is not needed until December.
"I think those are very important," she replied, without directly addressing a potential funding lapse. "Those are very important to the Senate."
Farm groups that work overseas to build market demand are particularly concerned about the prospect of hamstringing USDA's Foreign Market Development program, funded at $34.5 million annually. More than 20 organizations — including the U.S. Wheat Associates, U.S. Grains Council and American Hardwood Export Council — receive hundreds of thousands of dollars from that trade program. The federal funding is combined with contributions from their farmer-members and used to staff offices overseas, provide technical assistance to help build demand for generic commodities, and bring foreign customers to the U.S. to showcase the quality of American crops.
Scott Shearer, a lobbyist for the Bockorny Group, who represents recipients of FMD funding, said a spending lapse means some farm groups will have to cut back on programming and even close offices if Congress doesn't pass a new farm bill.
"By not having a full-time presence in major markets, it will negatively impact ag exports at a time of trade uncertainty and low prices," Shearer said. "It sends a signal to competitors that [the U.S.] is ceding markets to them."
U.S. Wheat Associates has 15 offices around the world and was awarded $3.6 million in fiscal 2018. It would have to rely on cash reserves from producers to maintain current offices and staffing levels, said spokesman Steve Mercer. The trade group also could shift some money it receives under another USDA trade promotion initiative, known as the Market Access Program. The farm bill allocated a mandatory $200 million a year for MAP, and it doesn't expire until the end of the calendar year.
However, it wouldn't be very long before draining those reserves would force U.S. Wheat Associates to close offices, Mercer added.
"After six months, we wouldn't close our doors, but only work in areas where we feel we could get the best return," he said.
The coalition has met with the House and Senate agriculture committees, as well as appropriators, but lawmakers are still operating under the mindset they can finish a farm bill this week.
Advocates of the smaller farm bill programs warn against allowing the law to expire and are urging agriculture leaders at least work out a temporary solution, noting that there would be consequences to vital agriculture programs.
"Not having anything in place is just not acceptable," said Cora Fox, a policy associate at the Center for Rural Affairs in Lyons, Neb. "Not having an extension undermines USDA's ability to work with farmers and ranchers."