Revenue assurance still on the table

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While speaking to attendees at Commodity Classic, Secretary of Agriculture Ed Schafer said he is confident the House and Senate can agree upon a farm bill this year. He continued the Administration's stance on objecting to raising taxes and increased baseline spending needs to adopt some sort of reforms. Schafer stated the current countercyclical payments set by government agencies sometimes give producers money when they need it least.

A better approach would include revenue and yield tied to the safety net, an approach championed by the National Corn Growers Association and pushed by the administration in its farm bill proposal. Schafer stated the revenue option is one included in the "overall discussion of reform."

National Corn Growers Association is holding out that crop revenue assurance could be included in the mix. This week Congressional leaders are nearing agreement on funding, with reports indicating $10 billion above baseline for a 10-year farm bill. NCGA President Ron Litterer said his organization is now willing to give up direct payments in the range of up to 20% and redirect those budget savings to pay for a revenue assurance option.

Saturday in comments made via satellite, House Agriculture Committee Chairman Collin Peterson (D-Minn.), speaking from Washington, D.C., gave the keynote address during opening night of National Farmers Union's 106th annual convention in Las Vegas. With the March 15 deadline fast-approaching, he told attendees he had been meeting with other agriculture leaders throughout the weekend. "We're moving slowly ahead, at least not backwards and we're close to getting a final resolution," Peterson said. 

The Senate overwhelmingly passed its farm bill version by 79-14, a clear veto-proof margin. Only 11 House Republicans voted in favor of its version, which makes it more difficult to override a presidential veto. Peterson said it's likely Congress will extend the current law one more month until April 15.

NCGA spoke out about the continued delay, urging Congress to expedite final passage of a bill. "We hope that all sides involved will quickly come to an agreement and get the bill completed by the March 15 deadline."

Litterer added, "While commodity prices remain well over target price levels, it is important that growers be able to plan for this crop year and those over the next five years," Litterer added. "The expiration of the 2002 farm bill has been no secret and did not come by happenstance. Action needs to be taken now to ensure the farm bill is competed in a timely manner."

NCGA is optimistic that this farm bill will include an improved risk management tool that will address the increasing levels of risk farmers are facing today and in the future. The House, Senate, and administration farm bill proposals all include revenue programs. Litterer said corn growers need a farm bill that delivers a more market-oriented safety net that ensures assistance when it is needed most. 

Both NCGA and the American Soybean Association (ASA) stated a 10-year farm bill provide some budgetary advantages. However, the way the market is changing so quickly a 10-year bill may not provide the needed safety net in the years ahead. 

Schafer said the White House still supports the House framework proposal of $6 billion above baseline. Senate Agriculture Committee Chairman Tom Harkin has said the Administration has not provided "acceptable" additional funding measures. Schafer added Harkin hasn't found funding measures "that he likes." The challenge is to have a "big enough bucket of increased spending over baseline" to please everyone.

Thursday night Schafer met with Southern Congressional leaders in discussing payment limitations, and how to best address those that have legitimate concerns and those who receive payments, but don't need them.