Senate Returns to Farm Bill

December 11, 2001

The Senate was scheduled to return to consideration of a farm bill today with Senate Agriculture Committee Chairman Tom Harkin (D-IA) ready to propose a substitute for the committee's version that adds another $1 billion to conservation and includes a new dairy provision as well. More than 30 agriculture and food groups urged the Senate to wind up debate by Wednesday so enough time can be taken for a conference with the House before the holiday recess.

In a letter to Senate Majority Leader Tom Daschle (D-SD) and Republican Leader Trent Lott (MS), the groups said, "We believe it is vitally important that this legislation be enacted this year to provide an important economic stimulus to rural America before Congress adjourns. We fully understand that policy differences exist regarding this important legislation and would encourage a healthy debate on these issues. However, we are very concerned that the time frame to pass this legislation is rapidly drawing to a close. We believe this will require the Senate to complete a thorough debate and achieve passage of the legislation by Wednesday evening."

In floor remarks Monday, Harkin said he believed debate on the bill could be concluded by late Wednesday with a limit on debate and amendments.

New farm legislation must be enacted this year, the groups added, "to stimulate and stabilize our rural economy that has been in an economic downturn for five years with no turn-around in sight. Unlike many sectors of the economy, production agriculture did not share in the economic growth of the last decade and has been devastated by depressed commodity prices, declining market opportunities and increasing costs."

Harkin's substitute bill on dairy would provide $2 billion in direct payments to dairy producers over four years. Another substitute was expected to be proposed as well, by Sens. Thad Cochran (R-MS) and Pat Roberts (R-KS). The dairy provisions in the Cochran-Roberts bill are virtually the same as those passed by the House.

Sen. Chuck Grassley (R-IA) was prepared to offer four amendments to the bill: one is designed to prevent meat packers "from assuming complete control of the meat supply" by preventing packers from owning livestock. The amendment would make it unlawful for a packer to own, feed or control livestock intended for slaughter. "Concentration is one of the biggest challenges facing the family farmer trying to compete in the global marketplace," Grassley said. "Remarkably, the farm bill reported out of the Agriculture Committee doesn't address this critical issue in any way."

The second of Grassley's amendments also addresses concentration within the industry by limiting mandatory arbitration agreements. The provision would amend the Packers and Stockyards Act to prohibit mandatory arbitration clauses from being included in contracts between livestock producers and packers. Grassley said the amendment would allow farmers the opportunity to choose the best form of settlement when a dispute arises.

Grassley intends to help livestock producers with a third amendment that would develop methane-recovery manure management systems. Grassley said the committee-passed farm bill makes manure management systems eligible for funding through the Environmental Quality Incentives Program (EQIP) but does not include an opportunity for the production of "green" electricity generated from hog and cattle waste. The Grassley amendment would make EQIP payments available to producers for cost-sharing on projects that involve the use of "anaerobic digesters."

The fourth Grassley amendment would help farmers who were not included in the 1996 farm bill receive loan deficiency payments. The amendment would provide a one-year extension of a provision in the Agricultural Risk Protection Act of 2000 that furnished LDP's to farmers not participating in the 1996 farm bill.