FRANKFORT, Ky. (Oct. 10, 2013) — While the federal government was shutting down at midnight on Oct.1, another important piece of federal policy – the U.S. Farm Bill – expired.
Congress has still not reached agreement on a new Farm Bill, which authorizes most spending under the USDA. But as the Kentucky Farm Bureau’s National Affairs and Political Education Director Joe Cain told the Interim Joint Committee on Agriculture on Wednesday, an agreement could be in the works.
Cain explained that although debate on a “continuing resolution,” or CR, to fund the federal government is the current hot topic on Capitol Hill, the U.S. House may be close to naming conferees to work with the Senate on agreeing to – and passing – a new Farm Bill by the end of the year. Farm Bill watchers hope those conferees will be announced by the end of this week or start of next week, he told the committee.
“Serious action” on a new Farm Bill may not be seen until December, depending on how debate proceeds on the CR this fall, said Cain. But he added that a conference agreement on a Farm Bill could result in the bill being attached to a “long term” CR in time.
“Now, unless it’s (FB) conferenced, that won’t happen, but that’s an outside possibility,” he said.
The major difference between the House and Senate Farm Bill proposals at present is federal nutrition benefits and assistance, Cain explained. He said the Senate has proposed reducing SNAP by $4 billion over 10 years while the House has proposed nearly $40 billion in reductions over the same period. “So, how they come to an agreement that would be able to pass a conference report is going to be of interest,” he said.
Other issues of interest in the Farm Bill debate is whether payments on acres under commodity title will be linked to base acres as proposed by the Senate or planted acres as proposed by the House, and the matter of parity, which Cain said determines what the price of milk supports would be. Additionally, the lapse of the Farm Bill has resulted in the expiration of dairy safety net programs under what is called the Milk Income Loss Contract, or MILC.
House Agriculture Committee Chairman Rep. Tom McKee, D-Cynthiana, asked Cain what would happen to the price of milk by Jan. 1, 2014 if nothing is done by Congress. While the effect would not be immediate, Cain said the price of a gallon at the grocery could “easily” rise to $5-$6 a gallon as milk supports rise to $40 per hundredweight (cwt.) from the current $18 per hundredweight range. The public would probably see the price of milk increase in February or March after the USDA finishes calculating “a totally new approach,” said Cain.
“The dairy industry right now is probably the one that is most in question right now,” Cain said.
Senate Agriculture Committee Chairman Sen. Paul Hornback, R-Shelbyville, said another major concern is the effect of the shutdown on farmers financing through the U.S. Farm Service Agency who are now in process of harvesting their crops. Because of the shutdown, those farmers cannot get their FSA checks endorsed as required at local FSA offices, said Hornback.
“That is one of the major concerns—just so we don’t forget that,” he added.
Ultimately, Cain said he believes a Farm Bill could be passed “fairly quickly” if the House and Senate Farm Bill conferees meet and agree, adding that “95 percent of the Farm Bill language is fairly easily conferenced. There’s not a whole lot of disagreement”, except on key sticking points he mentioned.