WASHINGTON — Upholding its promise to restore cuts made to the crop insurance program, the House and Senate passed H.R. 22, the Fixing America’s Surface Transportation (FAST) Act in early December. The 5-year, $305 billion highway bill will provide funding for U.S. transportation and infrastructure projects as well as included a provision to restore $3 billion in cuts to crop insurance.
Proposed cuts
The Bipartisan Budget Agreement of 2015, which was introduced in late October, proposed $3 billion in cuts to the federally subsidized crop insurance program over a 10-year period. After passage in the U.S. House of Representatives, agricultural leaders, farmers and industry professionals quickly jumped to their feet and took action to defend the program.
A colloquy on the Senate floor brought forth statements from Senate Majority Leader Mitch McConnell, R-Ky., who defended the crop insurance program on behalf of the agriculture community and from Sen. Pat Roberts, R-Kan., who stated cuts to the program would “greatly damage the crop insurance program as we know it.”
Within 48 hours, Republican House Agricultural Committee Chairman, Rep. Mike Conaway, R-Texas, was able to reach an agreement with House leaders and was joined in agreement by the Senate to reverse the cuts to crop insurance in the upcoming omnibus spending bill.
Votes are in
H.R. 22 or the FAST Act was passed by the House, 359-65, and passed on to the Senate which passed the legislation, 83-16, later that same day. The $3 billion in proposed cuts will instead be reflected in the Federal Reserve dividend that goes out to big banks.
“When the cuts to crop insurance were announced earlier this year, the message from farm country could not have been clearer: do not target crop insurance,” Roberts said in a release following the passage of the FAST Act.
A safety net
Crop insurance provides a safety net to many farmers across the country to fall back on during years of flooding, droughts or other severe weather conditions when yields are not as profitable.
“Soybean farmers across the country rely on crop insurance in times of extreme weather to ensure they can stay in business to farm in the coming year. An ill-advised $3 billion in cuts would have severely hobbled the program, and we’re happy to see them reversed,” said Wade Cowen, president of the American Soybean Association.
Cuts to the insurance program might have also put pressure on many private insurers who have already faced a great deal of changes to the program, forcing many to leave the business. Large agribusiness players, such as John Deere, Monsanto and Wells Fargo, were already making moves to exit the market before these cuts were proposed.
In the spotlight
According to the USDA’s Risk Management Agency, 294.7 million acres were insured were insured in 2014 and the total cost of the crop insurance program was $7.7 billion.
These proposed changes and many before it seem to be an indication that crop insurance remains under the watchful eye of government leaders who feel the program is too costly.
Other provisions
The highway bill would also include a provision calling for a permanent exemption from the U.S. Department of Transportation (DOT) Hours-of-Service Rule for truckers hauling livestock and poultry and for establishment of a Port Performance Statistics Program.
The Hours-of-Service Rule requires certain truckers to take a 30-minute rest break for each 8 hours of service. The National Pork Producers Council, in June, got a two-year exemption from the rule for livestock haulers but pushed for the permanent waiver.
The port performance provision requires DOT’s Bureau of Transportation Statistics to establish a working group of private-and public-sector participants to develop a set of metrics on port marine terminal productivity.
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