Farm Bill Update April 22, 2002 Received from Brent Searle, Special Assistant to Director/Farm Mediation Program Coordinator Department of Agriculture Brent.SEARLE@state.or.us 1-503-986-4558 Farm bill conferees continued their marathon meetings through the weekend of April 20. Last Thursday, (April 18) House conferees offered a new and comprehensive farm bill proposal. Later that evening, Senate conferees offered a counter-proposal. Conferees are now reviewing both proposals on a title-by-title basis. Over the weekend, negotiators made steady, but slow progress on resolving a number of policy issues, but remained deadlocked on key issues, including commodity loan prices, payment limitations, and packer ownership of livestock. Conferees are scheduled to meet again on Tuesday afternoon, April 23. Conferees considered the Conservation Title on Friday, April 19 and took the following action: -agreed to the House proposal on the Conservation Reserve Program (CRP) with Senate language adding $75 million for hardwood tree contracts. The acreage  cap is increased from 36.4 million to 39.2 million,and the wetlands pilot program is expanded to 1 million acres with all states eligible. Total CRP spending is $1.6 billion. -agreed to the Senate proposal on the Wetlands Reserve Program (WRP) for an additional 1.3 million acres with total funding of $1.5 billion. -deferred final action on the proposed new Grasslands Reserve Program (GRP),  but agreed to the House proposal setting enrollment at 2 million acres and a  funding level of $254 million. Policy language is being developed on program details, such as lengths and terms of easements and rental rates. -agreed to identical House and Senate proposals on the Farmland Protection Program (FPP) for a funding level of $1 billion. Provisions for market viability grants/contracts is still being negotiated. -agreed to the House proposal on the Wildlife Habitat Incentives Program (WHIP) and funding level of $700 million. -deferred final action on the Environmental Quality Incentives Program (EQIP) after lengthy discussion. Issues of disagreement include: (1) Senate proposals for payment limitations on contracts; (2) Senate proposals to limit eligibility of large farm operations; (3) length of contracts; (4) splitting funds evenly between crop and livestock assistance; and (5) total funding amount ($10 billion proposed by the House, $7.9 billion proposed by the Senate. -deferred final action on Water Conservation Programs. The controversial water rights provision (Reid amendment) has been deleted from the legislation. -deferred action on the Conservation Security Program (CSP) after lengthy debate. House conferees have proposed a $100 million per year pilot program to explore incentive payments for farmers. They argued the concept was worthy, but believed the mandatory funding of $3.4 billion is too much for a new, untested program. House conferees said a "go slow" pilot program approach would allow development and design for a national program. The House members also asked numerous and detailed questions about how the program would work, eligibility, payment amounts, and eligible conservation practices. White House  agricultural advisor Chuck Conner was asked for the Administration's position. He stressed the need to be cautious on a new initiative and strongly supported the pilot program. Conner also noted the Senate proposal called for mandatory spending and expressed concern about how to estimate the costs and how many farmers would qualify. Sen. Tom Harkin (D-IA) said he would continue to fight for the Senate proposal.. -deferred action on the Small Watershed Rehabilitation Program. Rep. Frank Lucas (R-OK) is developing new language. -deferred action on a Senate proposal to target an additional $10 million in conservation assistance to "underserved" states. -agreed to a Senate proposal for organic research funding at $15 million. On Saturday, April 20, farm bill conferees discussed the Commodity and Trade Titles and took the following action: -deferred action on commodity loan rates, fixed payments, and target prices for program crops. House and Senate conferees debated and argued for their respective proposals, but did not reach any agreement. Conferees did agree on the issues of base acres, payment yields, advance payments, and LDP authority. -deferred action on payment limitations after lengthy and frustrating debate.  Generally, Senate conferees argued strongly that payment limits were needed to restore credibility to farm programs, prevent large corporate farms from reaping unintended benefits, and weed out those who are abusing the system. House conferees were equality adamant in their opposition to the Senate proposal and cited the impact payment limits would have on producers and landowners under different scenarios. -deferred action on the Peanut Program after failing to reach agreement on loan rates, fixed payments, target prices, and the quota buyout. -agreed to identical House and Senate proposals on the Honey Program maintaining a loan rate of 60 cents/lb and total program funding of $101 million. -agreed to the Senate proposal for Specialty Crop Purchases. The proposal would increase carryover spending authority for Section 32 commodity purchases. Additional commodity purchases that would require not less than $200 million of Section 32 funds will be used in FY02-12 to purchase fruits and vegetables, and at least $50 million to be used for fresh fruits and vegetable for schools through the Department of Defense Fresh Program. -agreed to the Senate proposal on the Step 2 Adjustment program for cotton producers. -agreed to a combination of the House and Senate proposals on Wool and Mohair providing a loan rate of 40 cents/lb for unshorn pelts, a loan rate of $4.20/lb for mohair, with total funding of $205 million. -deferred action on a Senate proposal to provide Farm Savings Accounts. Both House and Senate conferees agreed the concept had merit, but had reservations about whether producers would participate in the program now because of low prices and slow farm economy. Conferees also expressed concerns about jurisdictional problems with the congressional tax-writing committees. -deferred action on a Senate proposal establishing a new market assistance loan program for the so-called Pulse Crops (dry peas, lentils, and  chickpeas). Reps. Richard Pombo (R-CA) and Cal Dooley(D-CA) expressed concern that increased competition would hurt California producers of certain crops that do not receive loan assistance. Senate conferees argued that it would provide stability to producers and lenders, allowed farmers to diversify, and assist producers in rotating crops which is sometime necessary to break disease cycles. On Saturday afternoon, conferees held lengthy discussion on the Trade Title, but did not reach any agreement on major issues. A major issue is funding levels for the Market Access Program (MAP). Lawmakers acknowledged that the House and Senate proposal are almost identical on the Food for  Progress program and the International Food for Education program. There is also  disagreement on allowing financing for agricultural trade with Cuba. On Tuesday, April 23, the full House is expected to address this issue and consider a motion to instruct conferees. On Sunday, April 21 conferees considered the Research Title which includes grants for a variety of agriculture, rural development and food system initiatives. The Senate proposal includes $45 million for research and extension service programs for beginning farmers. Conferees reached tentative agreement, although there is still a difference between the House and Senate proposed funding levels. Conferees also briefly discussed the Energy Title and the merits of proposals to promote renewable energy and fuels. There are no major disagreements on policy programs, but rather whether spending should be mandatory or discretionary.