By ANN HINCH
Assistant Editor WASHINGTON, D.C. — The House’s proposal for a new five-year farm bill passed by a 231-191 vote Friday afternoon, mostly supported by Democrat representatives – only 14 nixed the proposal, compared to 177 Republican legislators.
“We’re going to put a farm bill in place, and it’s not going to increase the deficit by one dollar,” said Rep. Joe Donnelly (D-Ind.).
He said much of the Republican objection to passage was based on paying for a $4 billion revenue gap in the proposed bill by closing what President Bush calls “the Bermuda loophole,” that allows foreign corporations to avoid U.S. tax rates by instead running business through offshore locations. Donnelly supported the change, calling it “much better than increasing taxes on American taxpayers.”
According to a Congressional Budget Office (CBO) cost estimate report dated July 24, this version of the Farm, Nutrition and Bioenergy Act of 2007, if enacted, would increase direct spending for the programs under its sphere by $17.5 billion over the next decade, $5.8 billion of that over the next five years alone. Total spending would be $614 billion over the next decade, $286 billion of which would be from 2008-12.
(Note: Possible changes to CBO financial estimates enacted by the House between July 24 and 27, other than those referenced below, were not immediately available.)
The CBO report stated of the projected spending increases over 2008-17, $16.9 billion can be attributed to an amendment to Title IV and Title IX – Nutrition and Energy, respectively. Were those changes not proposed, CBO estimates a net increase of only $577 million from 2008-17, which includes a reduction in spending by $607 million over the first five years.
Under Nutrition, the biggest share of increased spending over 10 years – $7 billion ($2.4 billion from 2008-12) – would be from allowing households to deduct more of their gross income as not available for food purchases, making them eligible for food stamp assistance. A House Ag Committee statement added this should “expand access” to such assistance.
Donnelly said this title would also provide healthy snacks to schoolchildren for the twin purposes of eliminating childhood obesity and benefiting American farmers.
In the Energy title, CBO stated over the next decade $5.8 billion ($2.4 billion from 2008-12) of the proposed increase would be to “promote production, use, research and development of renewable and biobased sources of energy.” Another $3.1 billion increase – nearly half in the first five years – would finance the use of sugar as a feedstock in ethanol production. According to CBO, this would reduce the cost of sugar subsidies by $240 million in the next 10 years.
Another $2.9 billion would cover costs of guaranteed loans for biofuel plants, grants to develop renewable energy for farms and biomass energy research and development. According to Rep. Brad Ellsworth’s (D-Ind.) office, as of July 27, the House passed $1.5 billion for ethanol and biodiesel production and $2 billion in loan guarantees to develop refineries to process renewable fuels, increasing those programs a combined 600 percent.
Mandatory country of origin labeling for fruit, vegetables and meat is also part of the House’s proposed farm bill, as is lowering the cap to $1 million of adjusted gross income to prevent those earning more than that from receiving conservation and farm program payments.
According to Ellsworth, an amendment passed that would delay the proposed closure of some county FSA offices by one year (see Page 3 for related article on a recent Indiana hearing).
Indiana may also benefit from a “Farm Flex” program Donnelly and Ellsworth proposed, a pilot which would allow Hoosier growers to substitute up to 10,000 acres of contract tomatoes for subsidy crops without losing their permanent subsidy status. They would not receive program payments for those acres planted, but would again be eligible when they replant corn or soybeans.
Fruit and vegetable growers in California and Florida have objected to this in the past as unfair competition. But Donnelly said, “we’re going to find out that … there’s such demand, that the Indiana program will not affect prices in California at all.”
Two other Indiana-specific provisions, according to Ellsworth, are to locate a Midwest Center for Specialty Crop Research, in conjunction with Purdue University, in the 8th District, and to provide for a Midwest Oak Tree Restoration pilot program.
Donnelly believes the Senate’s farm bill proposal – anticipated sometime next month, since the current bill expires Sept. 30 – will be “very similar” to the House’s. Senators are already proposing legislation, including a measure last week to replace price supports with revenue protection (see related article on Page 1).
He said he met with farm organizations in his 12 counties and concluded of the proposed bill, “While it’s not perfect, it’s a tremendous bill that covers most areas that Indiana farmers are looking for.”
This farm news was published in the Aug. 1, 2007 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee. |
