Ag Committee OKs draft of new farm bill; boosts conservation

WASHINGTON – With bipartisan support giving its approval on a voice vote, the House Agriculture Committee completed its work on the 2001 farm bill July 27.

The bill, “The Agricultural Act of 2001″ H.R. 2646, will go to the full House this fall. The Senate Agriculture Committee is just beginning work on its own version.

The House Ag Committee’s bill hopes to enlarge participation in soil and water conservation by 80 percent above current budget trends.

The House version gives producers the choice to update their base acres, and adds counter-cyclical support based on target prices to the already-established 2002 level of transition payments.

“The bill reported today is a good deal for agriculture and a good deal for taxpayers,” said Ranking Minority Member Charlie Stenholm, D-Texas. “Emergency spending by Congress to respond to agriculture’s income crisis was proof that our programs need reworking.

Commodity programs. The farm bill proposal maintains maximum planting flexibility while providing counter-cyclical protection, and retains fixed-decoupled payments, as well as the marketing loan program.

Marketing loan rates are maintained for all commodities except oilseeds, which are reduced to a level equivalent to other commodities, and grain sorghum which is raised to a level equivalent to corn.

It gives producers the option to update base acreage. Current base yields are maintained.

Both fixed-decoupled, and counter-cyclical payments are made on the producer’s base. For oilseeds and farms without current AMTA payment base and yields, the U.S. agriculture secretary is directed to develop payment yields that are comparable to current AMTA yields in the area.

Counter-cyclical payments are triggered when a crop’s price, adjusted for the fixed decoupled payment, is below the target price.

The payment rate for a crop would be calculated as the difference between its target price and the sum of the following components:

a) The higher of the national 12-month season average price received by producers, or the national average loan.

b) The fixed decoupled payment rate.

Payment limits are set at $50,000 for fixed decoupled payments, $75,000 for counter-cyclical payments and $150,000 for marketing loan gains and loan deficiency payments.

Other crops.

* Sugar. Eliminate marketing assessment on sugar, reduce the CCC interest rate on price support loans, authorize a Payment-in-Kind program, reestablishes the no-net-cost concept feature of the program and provides the Secretary authority to implement allotments for sugar producer.

* Dairy. Extend the milk price support program at $9.90 per cwt. through 2011; extends authorization for the Dairy Export Incentive Program through 2011, at the maximum level allowed under U.S. world trade commitments.

* Wool and mohair. Creates a marketing assistance loan program similar to other program commodities; provides producers price support loans or loan deficiency payments.

Loan rate of $1 per pound for graded wool, 40 cents per pound for nongraded wool and $4.20 per pound for mohair.

* Peanuts. Makes historic reform to peanut program to make peanuts similar to other traditional program crops and terminates marketing quota program and compensates the quota holders for the loss of the quota asset value at 10 cents per pound per year for five years.

* Fruits and vegetables. Give the Secretary sole decision authority to combat outbreaks of plant and animal diseases with emergency funds, retain planting restriction of fruits and vegetables on base acres, provides additional $200 million in spending authority for surplus commodity purchases under Section 32, increases the Market Access Program by $110 million per year, creates a Technical Assistance Specialty Crop fund to assist with trade barriers, provides $15 million per year through 2011 for the Senior’s Farmers Market Program.

Conservation. The conservation section devotes over $16 billion over 10 years to soil, water and wildlife programs, a 75 percent increase in baseline spending. Program changes include:

* Reauthorize the Conservation Reserve Program through 2011 with a 39.5 million-acre enrollment cap. Secretary may permit harvesting of biomass for energy on CRP acreage with a reduction in rental rate.

* Reauthorize the Environmental Quality Incentives Program through 2011 at $1.2 billion annual program level, with livestock producers receiving 50 percent of annual funding.

In addition, a $675 million fund is created in EQIP to address ground water conservation issues, including cost share for more efficient irrigation systems.

In addition, there is explicit authority for the Secretary to implement an incentives payment program for producers of annual and perennial crops, such as tree nuts or fruits. This program places a high priority on residue, nutrient, pest, invasive species, and air quality management.

* Reauthorize the Wetlands Reserve Program through 2011 and provide for an additional 150,000 acres to be enrolled per year.

* Reauthorize the Wildlife Habitat Incentives Program to provide cost share for landowners to enhance wildlife habitat at a program level of $25 million annually.

* Reauthorize the Farmland Protection Program at a program level of $50 million annually.

* Provide up to $100 million per year (not more than $850 million may be spent in the 10-year period) to provide conservation technical assistance to producers using any governmental, or private contractors.

Trade. Reauthorize the Market Access Program through 2011; reauthorize Food for Progress through 2011; reauthorize Foreign Market Development and increase funding to $35 million a year through 2011; reauthorize Export Enhancement Program through 2011; reauthorize the Food for Peace program through 2011.

Forestry. Creates a new Forest Land Enhancement Program by combining the existing Forestry Incentives Program and Stewardship Incentives Program. Funded at $15 million per year.

Also creates a Sustainable Forestry Outreach Initiative to provide education to landowners about sustainable forestry practices.

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