Senate Plows Ahead; House Leaders Hope

November 7, 2001

With much of Washington watching to see if Congress can wrap up the current first session of the 107th Congress by Thanksgiving, the Senate Agriculture Committee is moving ahead in marking up its version of a farm bill. House Agriculture Committee leaders say they hope everything, including a conference committee, can be completed by adjournment.

House Committee Chairman Larry Combest (R-TX) and ranking member Rep. Charles Stenholm (D-TX) said they hope that continued progress from the Senate committee could produce a bi-partisan farm bill in time to reconcile it with the House-passed bill yet this year.

"We are encouraged by the continued work of the Senate committee, because we believe we need a completed farm bill this year. When the House committee laid the groundwork for a farm bill rewrite, we began with producers more than a year and a half ago, involving 47 hearings and thousands of hours of work with grass roots farm organizations in order to achieve broad-based backing for the (House) Farm Security Act. Skeptics claimed the House Agriculture Committee could not complete our farm bill by September, so the Senate should be encouraged by the House experience that commitment and hard work can indeed produce a bi-partisan farm bill," Combest and Stenholm said.

But the Senate committee is facing two almost diametrically different bills, one from the chairman, Sen. Tom Harkin (D-IA) and another from ranking Republican Sen. Richard Lugar (IN). The committee has completed three of the 10 titles of bill. At Tuesday's Senate committee meeting Harkin and Lugar presented their competing proposals. A significant difference between the two proposals is in the commodity section. The Harkin proposal continues direct payment formulas to farmers and adding counter cyclical payments.

Lugar argued that this and other proposals that have been made would continue to stimulate over production, depress prices, artificially inflate land values and make U.S. farmers more uncompetitive in global markets. Additionally, he said, the current farm program focuses most federal spending on "program crops," mainly wheat, corn, cotton, rice and soybeans. Under the current program 60% of farms are excluded from federal farm programs, said Lugar. Also, he argued, the current program is skewed toward large farmers: 47% of the payments go to the largest 8% of farmers.

Lugar wants to replace commodity specific support programs with a risk management program available to all farmers. Beginning in 2003, any farmer or rancher with at least $20,000 in annual gross farm income and who provides five consecutive years of federal tax return information related to his farm business, regardless of commodities produced, would qualify for a voucher.

The voucher could be used to purchase federally backed whole farm revenue insurance that would ensure that the farmer receives 80% of average net farm income over the past five years. Also, matching funds would be deposited in an income stabilization accounts, or other approved risk management tools could be used to ensure up to 80% of normal revenue.

At the Tuesday business meeting, Lugar supported the forestry and energy titles approved by the committee. The forestry part of the bill includes increases in initiatives to stimulate good forestry practices on individually-owned private lands. The energy title will greatly expand funds for biomass research and bring biomass ethanol to the market.