The 20122013Farm Bill        Donn Teske    Kansas Farmers Union
The Farm Bill
Franklin Roosevelt    The Agricultural Adjustment ActCommonly credited as the original Farm Program, 1933
Evolution of the Farm Program •Parity, (market safety net) •Market distorting •Market non-distorting (1996 Freedom to Farm...
Tom BuisNational FU President        Stepped down        to serve as        CEO of Growth Energy
Federal Spending on Farm Safety NetSource:Congressional Budget Office                                         14
Farm Safety Net Spending 2011-2020     Marketing Loan Dairy/Specialty     Export      Benefits, $1.7 Crops, $3.7    Progra...
Senator Stabenow of Michigan
Congressman Frank Lucas       Oklahoma
Make-up of the Ag Committee          •Lot of new faces   •Every farm bill the committee   structure is getting more urban ...
Last second Farm Bill extension   Tied to the Fiscal Cliff Bill
MitchMcConnellPa
The extension really wasn’t so much an “extension” as a rewrite of the      Farm Bill with no debate         •Extended to ...
•REAP program in USDA RuralDevelopment gone. (Extended but not               funded)•Conservation Security program (CSP)  ...
A couple of “okay” things in the          extension       •Crop Insurance still there  •With the Direct Payments still ful...
Senator Thad CochranNew Ranking member of the Senate         Ag Committee
The fight is on!!!!!!
Effects of Farm Bill Expiration    Continuing Provisions            Expiring Provisions Crop Insurance                   ...
Effects of Farm Bill Expiration More Expiring Provisions Beginning Farmer and Rancher Development Organic Agriculture Rese...
Parity index
Why hasn’t the Farm Bill passed?• Republican leadership of the House hasn’t allowed  the bill to be voted on  – Speaker Bo...
Farm Bill Spending Comparisons to2013-2022 Baseline                      Senate      HouseCommodity Programs   -$19,428   ...
Differences between Farm BillsSenate Farm Bill (S. 3240)     House Farm Bill (H.R. 6083)Saves $23 billion              Sav...
Differences between Farm BillsSenate Farm Bill (S. 3240)      House Farm Bill (H.R. 6083)Cuts $6.3 billion from          C...
In both farm bills… • Direct and countercyclical payments, ACRE, and   SURE areeliminated • Crop insurance becomes the lar...
Existing     House PLCPrice Protection                                  Target Prices   Target Pricesin Existing Law      ...
An Alternative Safety Net• Farmer-Owned Reserves – includes a combination of farmer-owned   reserves, increased loan rates...
South Korea Free Trade Agreement                      65 / 35
Just    asuggestion
From the ETC group
HB 2575 Immigrant ID bill. This is a weirdone, it will allow illegal immigrants living herefor 5 years, or employed by a m...
Beginning Farmer Workshop: January             26, 2013   Nelson’s Landing Restaurant -          Leonardville, KS
9 AM – Welcome & Introductions9:15 AM – Donn Teske, KFU President and former farmer financial adviser    10 AM – Char Hent...
1 PM – Charlie Griffin – Kansas Rural             Family Helpline       1:30 PM – Bernard Irvine –    agricultural law inc...
3-5 PM – Producer Panel Darrell Parks of Manhattan, sustainable pasture porkEd Reznicek of Goff, Kansas Organic Producers ...
Food Hubs / Food Co-ops          April 6th, 2013         Hiawatha KansasHow Local Family Farms can feed our           comm...
A good wife brings balance to your life!
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
2012 farm bill, updated 1 22-13
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2012 farm bill, updated 1 22-13

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U.S. Farm Policy: Today and Tomorrow
Don Teske, President of Kansas Farmers Union.

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  • My grandkids. Can’t pass up the chance to brag.
  • Americans pay just 10 cents of every disposable dollar for groceries, the lowest price of any country in the world. America’s farmers and ranchers provide the safest, most abundant, most affordable food supply in the world. It is a fantastic bargain. It is because of this safety net that they are able to continue producing. The cost for this safety net for farmers and ranchers is only 14 percent of the farm bill, or 0.28 percent of the total federal budget.
  • According to projections from the Congressional Budget Office for the years 2010 to 2020, farm bill programs will account for about $1.1 trillion of federal spending. (This includes nutrition and conservation programs.)Only 14 % of the total Farm Bill spending – $150.2 billion – will be spent on farm income stabilization efforts. Of this, about $49 billion will be spent on direct payments; $5.5 billion on countercyclical payments; $3.2 billion to the new Average Crop Revenue Election (ACRE) program; and $1.7 billion to marketing loan benefits. Crop insurance programs were slated to receive $82.8 billion, although after the recent issuance of the 2011 Standard Reinsurance Agreement, this number will be $4-$6 billion smaller.
  • The Congressional Budget Office projects that total federal spending over the next 10 years will be $44.3 Trillion. That includes spending on defense, social security, medicaid, foreign aid, and everything else.  The Farm Bill is projected to account for 2.2% of that total, or about $970 billion. For the sake of comparison, this chart is based on the version of the bill that was passed by the Senate in June. On the bigger pie chart, you can see how that Farm Bill spending is divided. Nearly 80 percent goes to nutrition programs, such as the Supplemental Nutrition Assistance Program. Only about 15 percent goes to traditional farm safety net programs, and 6 percent goes to conservation. All other farm bill programs have outlays that account for $4.5 billion in outlays over ten years.
  • The farm bill expired on September 30, 2012. The date is important, because it marks the end of the effective time frame of the bill passed in 2008. However, some programs continue beyond the expiration date because of the way they are written into law. These include crop insurance, the SNAP program, and several others as seen on the left. The Conservation Reserve Program, for example, will remain in effect but new contracts or sign-ups will not be allowed.However, there are several commodity programs, such as direct and countercyclical payments, ACRE, and dairy supports like MILC, that will wind down after September 30. If the previous farm bill is not extended or a new bill is not passed, commodity support programs based on a concept known as “parity” will kick in, which would mean high support prices for many crops but also high costs to the government.Also, September 30 marked the end of baseline funding for 37 programs which were part of the 2008 farm bill. This includes: Beginning Farmer and Rancher DevelopmentHealthy Forests Reserve ProgramBiobased Market ProgramBiorefinery AssistanceRepowering AssistanceBioenergy Program for Advanced BiofuelsBiodiesel Fuel Education ProgramRural Energy for America (REAP)Market Loss Assistance for Asparagus ProducersNational Sheep Industry Improvement CenterSurvey of Foods Purchased by School Food AuthoritiesAssistance for Community Food Projects: Healthy Urban Food Enterprise Development CenterRural Microentrepreneur Assistance ProgramFunding of Pending Rural Development Loan and Grant ApplicationsOrganic Agriculture Research and Extension InitiativesSURE and other disaster programsOutreach and Technical Assistance for Socially Disadvantaged FarmersValue-Added Agricultural Market Development Program GrantsOutreach and Technical Assistance for Socially Disadvantaged Farmers and RanchersWetlands Reserve ProgramGrassland Reserve ProgramVoluntary Public Access and Habitat Incentive ProgramSmall Watershed Rehabilitation ProgramDesert Terminal Lakes ProgramMcGovern-Dole International Food for Education and Child Nutrition ProgramLocal and Regional Food Aid Procurement ProjectsPilot projects to evaluate health and nutrition promotion in the supplemental nutrition assistance programStudy on Comparable Access to Supplemental Nutrition Assistance for Puerto RicoWhole Grain Products for school lunches and breakfastsBiomass Research and DevelopmentBiomass Crop Assistance ProgramFarmers’ Market Promotion ProgramNational Clean Plant NetworkNational Organic Certification Cost-SharingOrganic Production and Market Data InitiativesDetermination on Merits of Pigford ClaimsSpecialty Crop Research Initiative
  • The farm bill expired on September 30, 2012. The date is important, because it marks the end of the effective time frame of the bill passed in 2008. However, some programs continue beyond the expiration date because of the way they are written into law. These include crop insurance, the SNAP program, and several others as seen on the left. The Conservation Reserve Program, for example, will remain in effect but new contracts or sign-ups will not be allowed.However, there are several commodity programs, such as direct and countercyclical payments, ACRE, and dairy supports like MILC, that will wind down after September 30. If the previous farm bill is not extended or a new bill is not passed, commodity support programs based on a concept known as “parity” will kick in, which would mean high support prices for many crops but also high costs to the government.Also, September 30 marked the end of baseline funding for 37 programs which were part of the 2008 farm bill. This includes: Beginning Farmer and Rancher DevelopmentHealthy Forests Reserve ProgramBiobased Market ProgramBiorefinery AssistanceRepowering AssistanceBioenergy Program for Advanced BiofuelsBiodiesel Fuel Education ProgramRural Energy for America (REAP)Market Loss Assistance for Asparagus ProducersNational Sheep Industry Improvement CenterSurvey of Foods Purchased by School Food AuthoritiesAssistance for Community Food Projects: Healthy Urban Food Enterprise Development CenterRural Microentrepreneur Assistance ProgramFunding of Pending Rural Development Loan and Grant ApplicationsOrganic Agriculture Research and Extension InitiativesSURE and other disaster programsOutreach and Technical Assistance for Socially Disadvantaged FarmersValue-Added Agricultural Market Development Program GrantsOutreach and Technical Assistance for Socially Disadvantaged Farmers and RanchersWetlands Reserve ProgramGrassland Reserve ProgramVoluntary Public Access and Habitat Incentive ProgramSmall Watershed Rehabilitation ProgramDesert Terminal Lakes ProgramMcGovern-Dole International Food for Education and Child Nutrition ProgramLocal and Regional Food Aid Procurement ProjectsPilot projects to evaluate health and nutrition promotion in the supplemental nutrition assistance programStudy on Comparable Access to Supplemental Nutrition Assistance for Puerto RicoWhole Grain Products for school lunches and breakfastsBiomass Research and DevelopmentBiomass Crop Assistance ProgramFarmers’ Market Promotion ProgramNational Clean Plant NetworkNational Organic Certification Cost-SharingOrganic Production and Market Data InitiativesDetermination on Merits of Pigford ClaimsSpecialty Crop Research Initiative
  • The main reason that the farm bill hasn’t passed is because of Republican leadership in the House of Representatives. It is widely believed that there is a divide among Republicans, as many newly-elected members would very much like to cut as much as possible from all programs, especially nutrition spending, which puts them at odds with those who want to pass a bill that is responsible and can be compromised with the Senate version. It is worth noting that Speaker Boehner has never supported a Farm Bill.Ranking Member of the House Ag Committee, Collin Peterson,said in September that there were enough votes to pass the bill, but Republican leadership didn’t want to have a internal party fight on the floor of the House.Here’s an example of the disagreement of the level of cuts to nutrition:Senate SNAP cuts = $4 billionHouse Ag Committee SNAP cuts = $16 billion“Ryan Budget” SNAP cuts = $134 billion
  • In terms of spending, the House bill includes much higher cuts than the Senate version. The House bill cuts $35 billion while the Senate bill cuts $23 billion.  Of particular note, the House bill cuts $16 billion from nutrition programs while the Senate bill only cuts $4 billion.
  • There are two versions of the farm bill currently in play. Looking at a comparison of the Senate passed bill and the bill passed out of the House Agriculture Committee, there are several key differences:The Senate bill cuts $23 billion while the House bill cuts $35 billionThe Senate bill Includes farm-level revenue coverage option while the House bill does notThe House bill includes reasonable levels of protection against long-term price collapse and the Senate bill does notThe Senate bill includes roughly $800 million in mandatory funding for energy programs while the House bill zeroes out fundingThe Senate bill tightens payment limits while the House will doesn’t change themNFU would like to see a blend of the Senate and House safety net title
  • Conservation programs are wildly popular and the demand for the programs continues to grow. They represent an opportunity to continue providing farmers and ranchers with a variety of tools to be good stewards of the environment. Current programs extended in both bills include the Environmental Quality Incentive Program, Conservation Stewardship Program, and the Conservation Reserve Program. The Senate bill includes a sodsaver provision and reattaches conservation compliance to crop insurance. The House bill includes neither.The energy title creates an opportunity for farmers and ranchers to earn an additional revenue stream, creates jobs in rural America and enhances energy security. Both the House and the Senate bills reauthorizes the Energy Title but only the Senate bill provides mandatory funding.
  • Despite the differences between the two versions of the legislation, there is a good deal of common ground.Direct and countercyclical payments, ACRE, and SURE are eliminated and are replaced by more defensible, need-based programs that help farmers survive difficult times.In both bills, crop insurance becomes the largest part of the farm safety net.Conservation interests reached a general consensus compromise and agreed to a streamlined set of programs. Dairy programs are based on the National Milk Producers Federation’s “Foundation for the Future” and will shift to margin insurance and weak supply management.The no-cost sugar program is extended in both bills.
  • This chart shows a comparison between the existing target prices for various commodities as well as the House PLC target prices. The Price Loss Coverage safety net option in the House Farm Bill increases target prices to levels that better reflect the realities of today’s market. It also protects against long-term price collapses, as other programs like RLC and ARC are based on average prices, not a fixed figure.The payment rate is also explained, as the program will make up some – but not all – of the difference between actual and target prices. The existing Upland Cotton program is replaced by a stand-alone, cotton-only program called STAX, or Stacked Income Protection Program.
  • 2012 farm bill, updated 1 22-13

    1. 1. The 20122013Farm Bill Donn Teske Kansas Farmers Union
    2. 2. The Farm Bill
    3. 3. Franklin Roosevelt The Agricultural Adjustment ActCommonly credited as the original Farm Program, 1933
    4. 4. Evolution of the Farm Program •Parity, (market safety net) •Market distorting •Market non-distorting (1996 Freedom to Farm) (Direct Payments) (welfare?) •Market safety net •Crop insurance
    5. 5. Tom BuisNational FU President Stepped down to serve as CEO of Growth Energy
    6. 6. Federal Spending on Farm Safety NetSource:Congressional Budget Office 14
    7. 7. Farm Safety Net Spending 2011-2020 Marketing Loan Dairy/Specialty Export Benefits, $1.7 Crops, $3.7 Programs, $3.5 ACRE, $3.2 Disaster, $0.8 Counter- Total: Cyclical $150.2 billion Payments, $5.5 Direct Payments Crop Insurance $49.1 $82.8 15
    8. 8. Senator Stabenow of Michigan
    9. 9. Congressman Frank Lucas Oklahoma
    10. 10. Make-up of the Ag Committee •Lot of new faces •Every farm bill the committee structure is getting more urban •Many of the traditional, powerful rural politicians are gone
    11. 11. Last second Farm Bill extension Tied to the Fiscal Cliff Bill
    12. 12. MitchMcConnellPa
    13. 13. The extension really wasn’t so much an “extension” as a rewrite of the Farm Bill with no debate •Extended to the end of September •Preserved Direct Payments •Dairy pretty well got screwed •Livestock indemnity payments gone, not funded•Livestock forage disaster program gone, not funded •Livestock emergency assistance gone, not funded •Crop disaster gone.•Beginning Farmer Program gone. (Extended but not funded)
    14. 14. •REAP program in USDA RuralDevelopment gone. (Extended but not funded)•Conservation Security program (CSP) gone, not funded. •Grassland Reserve Program (GRP) gone. •Wetlands Reserve Program (WRP) gone. •McGovern-Dole International Food Program, gone.
    15. 15. A couple of “okay” things in the extension •Crop Insurance still there •With the Direct Payments still fully funded the budget baseline is protected for the next round of negotiations on the farm bill
    16. 16. Senator Thad CochranNew Ranking member of the Senate Ag Committee
    17. 17. The fight is on!!!!!!
    18. 18. Effects of Farm Bill Expiration Continuing Provisions Expiring Provisions Crop Insurance Direct and Countercyclical Payments Supplemental Nutrition New sign-ups for Conservation Reserve Assistance Program (SNAP) Program (CRP) and Wetlands Reserve Noninsured Crop Disaster Program (WRP) Assistance (NAP) Grassland Reserve Program (GRP) Agricultural Management Rural Energy for America Program Assistance (AMA) Value-Added Product Development Emergency Conservation Program Grants Program Resource Conservation and Milk Income Loss Contract (MILC) Development (RC&D) Program All 2008 Farm Bill Disaster Programs Fresh Fruit and Vegetable Program
    19. 19. Effects of Farm Bill Expiration More Expiring Provisions Beginning Farmer and Rancher Development Organic Agriculture Research and Extension Initiatives Local and Regional Food Aid Procurement Projects Farmers’ Market Promotion Program Specialty Crop Research Initiative …and many more
    20. 20. Parity index
    21. 21. Why hasn’t the Farm Bill passed?• Republican leadership of the House hasn’t allowed the bill to be voted on – Speaker Boehner has never supported a Farm Bill – Ranking Member Peterson says there are enough votes• Disagreement over depth of cuts to nutrition – Senate SNAP cuts = $4 billion – House Ag Committee SNAP cuts = $16 billion – “Ryan Budget” SNAP cuts = $134 billion
    22. 22. Farm Bill Spending Comparisons to2013-2022 Baseline Senate HouseCommodity Programs -$19,428 -$23,584Crop Insurance $5,036 $9,524Conservation -$6,374 -$6,062Nutrition -$4,000 -$16,075Energy $780 $0Rural Development $115 $105Research $681 $546Other $50 $482Total -$23,140 -$35,064
    23. 23. Differences between Farm BillsSenate Farm Bill (S. 3240) House Farm Bill (H.R. 6083)Saves $23 billion Saves $35 billionIncludes farm-level revenue Does not include farm levelcoverage option (ARC) optionDoes not include much Includes reasonable levels ofprotection against long-term protection against long-termprice collapse price collapse (PLC)Tightens payment limits Doesn’t change payment limitsFunding levels & the safety net
    24. 24. Differences between Farm BillsSenate Farm Bill (S. 3240) House Farm Bill (H.R. 6083)Cuts $6.3 billion from Cuts $6 billion fromconservation title conservation titleIncludes sodsaver provision Doesn’t include sodsaverTies conservation compliance No conservation complianceto crop insurance eligibility restrictions for crop insuranceAllows funding for REAP Prohibits funding for REAPProvides $780 million in Doesn’t provide any mandatorymandatory funding for energy funding for energy programsEnergy & conservation
    25. 25. In both farm bills… • Direct and countercyclical payments, ACRE, and SURE areeliminated • Crop insurance becomes the largest of the farm safety net programs • Conservation programs are restructured and strengthened for effective delivery • Dairy programs shift to margin insurance and weak supply management • The sugarprogram is extended
    26. 26. Existing House PLCPrice Protection Target Prices Target Pricesin Existing Law Wheat (bu.) $4.17 $5.50 Corn (bu.) $2.63 $3.70and House Bill Grain sorghum (bu.) $2.63 $3.95Payment amount = Barley (bu.) $2.63 $4.95Target price X 85% oftotal acres planted to Oats (bu.) $1.79 $2.40crop (30% for Upland Cotton (lb.) $0.7125 STAXprevented plant) Rice, med &lg (cwt.) $10.50 $14.00X existing CCP yield or Soybeans (bu.) $6.00 $8.4090% of 2008-2012 avg. Other oilseeds (cwt.) $12.68 $20.15yield/planted acre Dry peas (cwt.) $8.32 $11.00 Lentils (cwt.) $12.81 $19.97 Peanuts (ton) $495 $535
    27. 27. An Alternative Safety Net• Farmer-Owned Reserves – includes a combination of farmer-owned reserves, increased loan rates, set-asides, the elimination of direct payments, and reduced reliance on other government payment instruments. 37
    28. 28. South Korea Free Trade Agreement 65 / 35
    29. 29. Just asuggestion
    30. 30. From the ETC group
    31. 31. HB 2575 Immigrant ID bill. This is a weirdone, it will allow illegal immigrants living herefor 5 years, or employed by a multi-statecompany, to legally work in Kansas and to applyfor a Kansas driver’s license. I think it iscommendable that the state is finallyrecognizing this very large hidden part of oursociety but am disappointed that itintentionally does not make this a step towardcitizenship. Long time opponents, corporate Agand social welfare groups, are allied in supportof this bill. Labor unions are opposed.
    32. 32. Beginning Farmer Workshop: January 26, 2013 Nelson’s Landing Restaurant - Leonardville, KS
    33. 33. 9 AM – Welcome & Introductions9:15 AM – Donn Teske, KFU President and former farmer financial adviser 10 AM – Char Henton& Becky O’Donnell, KS Ag Mediation Service 10:45 AM – Barb Depew, Kansas Farm-To-School Program 11:15 AM – Rhonda Janke, K-State Sustainable Agriculture 12 PM – Lunch by Nelson’s Landing Restaurant
    34. 34. 1 PM – Charlie Griffin – Kansas Rural Family Helpline 1:30 PM – Bernard Irvine – agricultural law including farm leases/terminations, fencing and boundary disputes,regulatory issues, business/succession planning and secured transactions2:15 PM – Chuck Otte – Geary County agricultural extension agent
    35. 35. 3-5 PM – Producer Panel Darrell Parks of Manhattan, sustainable pasture porkEd Reznicek of Goff, Kansas Organic Producers general manager Jason Schmidt and Herb Bartel of Hillsboro, organic farming and grazing partnership Warren Sutton of Norway, green bean growerDan Kuhn of Courtland, “Depot Market” growing and marketing wholesale and retail produce Dale Strickler of Jamestown, grazing specialist Robert Nutsch of Norway, produce growing on less than one acre Norm Oeding of Hillsboro, organic farm managerChris Janssen of Scandia, high tunnel produce grower
    36. 36. Food Hubs / Food Co-ops April 6th, 2013 Hiawatha KansasHow Local Family Farms can feed our communities
    37. 37. A good wife brings balance to your life!
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