By KEVIN WALKER
WASHINGTON, D.C. — A bipartisan group of U.S. senators introduced legislation last week designed to cut back on farm program payments to non-farmer investors and managers.
The Farm Program Integrity Act of 2013 is similar to language included in last year’s Senate farm bill proposal, according to the National Sustainable Agriculture Coalition (NSAC), a grassroots farm lobbying group.
The bill was introduced Feb. 12 by Sens. Charles Grassley (R-Iowa), Tim Johnson (D-S.D.), Mike Enzi (R-Wyoming) and Sherrod Brown (D-Ohio).
The bill would place a “hard cap” on the farm payments an individual farmer may receive in a year and close what Grassley called long-abused and well-documented loopholes in the farm payment program.
It would establish a per-farm cap of $50,000 on all commodity program benefits, except those associated with the marketing loan program (i.e., loan deficiency payments and marketing loan gains), which would be capped at $75,000.
The combined limit would be $125,000 for an individual, or $250,000 for a married couple. The $50,000 cap would apply to whatever type of program is developed as part of the new farm bill. It would also close loopholes that currently allow non-farmers to qualify for federal farm payments.
“A strong safety net is critical to ensuring a safe and affordable food supply,” Grassley said. “The Senate-passed farm bill made some important strides in this area, so it’s important we retain and build on those provisions.
“Ending some of the most egregious abuses of the farm program will ensure that the farm program payments are going to those who need them most. It’s unacceptable that small- and medium-sized farmers get so little of the very program that was created to help them.”
NSAC critical of House
In a statement issued last week, the NSAC praised the bill, saying it would help end widespread abuse in farm programs. It also compared the Senate legislation favorably to the House-passed farm bill from last year, criticizing the House Agriculture Committee for not adopting the same or similar language to cap farm program payments.
“Instead of putting an end to waste and fraud in farm programs, the House Agriculture Committee kept intact high caps and wide-open loopholes in the farm bill they voted out of committee last year,” the statement said. “We want to work with the House committee and the full House to ensure a sound and fiscally responsible farm safety net in the upcoming five-year farm bill debate.
“The Senate bill introduced today is an excellent place to start.
The prospects for actually getting a new five-year bill enacted this year will be much improved if the dual principles reflected in the Farm Program Integrity Act – directing benefits to working farmers, with reasonable caps – guide all farm safety net program deliberations.”
House Agriculture Committee spokeswoman Tamara Hinton objected to NSAC’s characterization of the House version of the farm bill.
“It’s just a fact that payment limits are in the House bill,” she said. “We have payment limits.
They’re more restrictive than they were in the 2008 farm bill. I don’t know why they’re trying to demonize our bill. We cut more than $35 billion in our farm bill.”
Hinton said the philosophy of capping farm program payments is the same in both pieces of legislation. In a separate interview last week, NSAC Policy Associate Julie Obudzinski sought to clarify matters when she explained that although the House version of the farm bill has caps, under its version some types of payments aren’t included in the caps.
“The current problem is that the standard used to decide eligibility for farm program payments is basically unenforceable,” she said. “I would say the loophole-closing is almost more important than the caps.”
But enforceable caps are important, too, she seemed to say, because “without a cap to these large farms, it really favors the large farms and makes it harder for the smaller farms to stay in business.”
‘Take a hard look’
In his speech on the Senate floor last week, Grassley said both the House and Senate versions of the farm bill last year sought to make meaningful reductions in spending. He said the Senate Agriculture Committee was one of the few committees that actually achieved savings in its area of responsibility, to the tune of $23 billion.
“One of the measures in last year’s farm bill was my proposal reforming payment limitations in the farm program,” Grassley said. “Adopting reforms to payment limitations contributed to the $23 billion in (proposed) savings (over 10 years).
“Beyond just being a part of saving money, these reforms help ensure farm payments go to those for whom they were originally intended, small- and medium-size farmers. In addition, the reforms include closing off loopholes so non-farmers can’t game the system.”
In his speech, Grassley went on to say supporters of the five-year farm bill are going to have to take a hard look at some issues if they want a bill passed this year. He asked if savings of $4 billion in the food aid program is a big enough cut, considering the nutrition title is the single largest expenditure in the farm bill, at $80 billion. That’s what was included in the Senate version.
“There are more reforms we can make to programs such as food stamps,” he said. “And they are reforms that cut down on waste, fraud and abuse in the program, while also safeguarding assistance for people who need it.
“There are other programs we need to take a fresh look at – should we accept the status quo on the sugar program? How do we handle dairy policy? What policy can we implement in the commodity program that won’t distort planting decisions, but maintains an effective safety net?
“These are some of the many issues we need to debate again and decide upon. I for one hope we are able to start soon and work together to get a five-year bill completed this year. Our farmers and rural communities deserve to have certainty,” he said.