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Crop insurance amendments include $750K income limit
By KEVIN WALKER
Michigan Correspondent

WASHINGTON, D.C. — Early last week the U.S. Senate voted on 70 amendments to the 2012 farm bill – including those regarding crop insurance subsidies – and it approved its version of the bill by a vote of 64-35 last Thursday.

Chair of the Senate Agriculture Committee Debbie Stabenow (D-Mich.) said on June 18 the committee had reached an agreement to let certain amendments be voted upon. “This bill was developed through bipartisan collaboration, passed committee with broad bipartisan support and we now have a bipartisan agreement to move forward with a bill that affects 16 million American jobs,” she said.

“My colleagues on both sides of the aisle understand we must act as soon as possible to give farmers the certainty they need to keep growing the economy. This farm bill is unlike any other before it – it cuts spending, ends subsidies, improves accountability and strengthens healthy food systems. We are now closer than ever to achieving real reform in America’s agriculture policy.”

One amendment put forth by Sen. Kirsten Gillibrand (D-N.Y.) would have struck a reduction in the supplemental nutrition assistance program (SNAP), or food stamps, and increased funding for the fresh fruit and vegetable program. It would have been done with an offset that would have limited crop insurance reimbursements to providers.

The vote, which took place June 19, was 66-33 against instituting this measure.

Crop insurance has been front and center for commodity groups this year. Chuck Hassebrook, executive director of the Center for Rural Affairs, a not-for-profit, opined that insurance subsidies for farmers are too generous to the largest farms. “There needs to be a cap on premium subsidies for mega-farms,” Hassebrook said.
He quoted from a recent study by the Environmental Working Group (EWG). The analysis, released May 31, shows that one policyholder in Indiana received a premium subsidy of more than $1 million, five received more than $500,000, 25 received more than $250,000, 301 received more than $100,000 and 839 received more than $65,000.

The EWG’s figures showed similar skewing in the other states in this region. There are 27 operations in the United States that have received more than $1 million in crop insurance subsidies per year, Hassebrook said. Quoting from the EWG analysis, he said on average, the government pays 60 percent of crop insurance premiums. “Overall, they’re spending more on crop insurance in the farm bill,” he added. “What we’ve done is switch from traditional crop programs to crop insurance programs, and conservation practices as well as caps have been left by the wayside.”

Hassebrook said although direct payments are being done away with, at least those subsidies were tied to conservation practices. The EWG analysis states while crop insurance benefits are concentrated in the hands of a few large farmers, most subsidies are modest and would be unaffected by proposals to cap them.
For example, one proposal would have put a cap of $40,000 on premium subsidies. The bottom 80 percent of policyholders, or 389,494 farm operations, received subsidies worth just over $5,000 in 2011.

A Sen. Saxby Chambliss (R-Ga.) amendment also passed, by a vote of 52-47. It would create a conservation requirement that’s tied to crop insurance subsidies.

An amendment cosponsored by Sens. Richard Durbin (D-Ill.) and Tom Coburn (R-Okla.) passed, 66-33. It would cap insurance subsidies based on income, with a cap of $750,000 in adjusted gross income for a policyholder – anyone making more than that would get a reduced crop insurance subsidy.
6/27/2012