U.S. farm policy has operated under a patchwork of continuing resolutions and unfunded programs for the past nine months, ever since the last farm bill expired.
Last week, however, the U.S. Senate passed a $955 billion omnibus farm bill, S.954, that closely resembles the legislation it passed last July, setting new spending levels and program priorities for farm, forestry and nutrition programs administered under the United States Department of Agriculture for the next five years. The 2008 farm bill expired Sept. 30, 2012.
As with the bill that passed the Senate last year, the Agriculture Reform, Food and Jobs Act of 2013, which passed 66-27, is projected to reduce federal spending by $23 billion over the next 10 years. The bill also includes an overhaul of the national dairy pricing and support system that has been in the works for more than two years.
The Senate version contains $4 billion in SNAP (food stamp) and nutrition spending reductions over 10 years. The House bill, which Speaker John Boehner, R-Ohio, supports, would reduce SNAP funding by $20 billion over 10 years. Last year, it was this funding that formed the main area of contention between Democrat and Republican factions of the House.
In a statement released last week, Boehner commended House Agriculture Committee chair Frank Lucas, R-Okla., for “making changes to the Food Stamp program that both parties know are necessary. These reforms account for billions of dollars in mandatory program spending cuts.”
Sen. Patrick Leahy, D-Vt., and Sen. Bernie Sanders, I-Vt., heralded the Senate bill’s passage as a victory for Vermont’s rural communities and agriculture, particularly dairy. Leahy, who sits on the Senate Agriculture Committee, was optimistic about the dairy provisions outlined in the bill.
“It offers new hope for minimizing the rollercoaster price swings that have made dairy farming so precarious for so long and will do so at a lower cost than the current program,” Leahy said in a news release.
The program would do away with the Milk Income Loss Contract (MILC), which currently offers price supports to farmers when dairy commodity prices drop. Instead, MILC would be replaced by a crop insurance program, which would base price supports on the margin between feed prices and wholesale milk prices.
The Senate-passed farm bill also establishes a dairy supply management program, which would attempt to minimize severe dips in milk prices by requiring farmers participating in the crop insurance program to reduce milk production when prices fall. The new program is expected to prevent further price dips resulting from an oversupply of milk on the market, and in turn to save the USDA money due to a reduced need for price support payouts.
The Senate’s farm bill also eliminates direct payments to commodity producers, continues funding for conservation programs that aim to keep agricultural waste out of waterways and requires farmers to comply with environmental regulations and programs in order to receive crop insurance and other USDA benefits.
Following the Senate’s passage of last year’s farm bill, the House Agriculture Committee passed a version of the bill that, while similar, included greater reductions in spending.
The bill stalled, however, when Republican leadership did not bring the bill to the House floor out of concern that the vote would test party allegiances before the election.
With an unfinished bill and the promise of a jump in agricultural prices once existing policy ended, Congress approved a continuing resolution to fund specific USDA programs on Dec. 31. That extended many of the 2008 farm bill’s provisions through the end of the current fiscal year, which ends Sept. 30.
The final provisions of the new farm bill will not be solidified until the House has approved its own version of the bill — a process expected to begin later this month.
Once passed, the two versions will enter the process of reconciliation to merge them into one document.
