Farm Bill Update: Congress Passes One-Month Extension
The frustration of farmers across the nation is rising as the status of the U.S. Farm Bill continues. Last week, President Bush signed to extend the 2002 Farm Bill until April 18. At that point if Congress does not pass the bill, Bush proposes to extend the bill for another year. The major concern that Bush has is trying to fit the proposed Farm Bill into the budget.
“Farmers and ranchers deserve to know the structure of policies that affect their day-to-day business activities, and right now they face uncertainty,” Bush said in a statement on March 13.
He has said he will not sign a Farm Bill that’s over the baseline. So, what’s the hold up? The House Ways and Means and Senate Finance committees cannot reach an agreement on how to fund the $10 million over the $280 billion baseline.
As Congress recesses for the next two weeks, there has been talk of scrapping the bill and starting from scratch – writing a bill that would include no new spending above the baseline. There is still a lot of work that needs to be done for the Farm Bill to pass, but the budget issue still remains. There must be some agreement regarding the funding of the U.S. Farm Bill.
With this delay, farmers are facing a new problem. This extension leaves farmers in a precarious position as they try to plan for the coming planting season. Without a Farm Bill in place, farmers are at a loss. They have nothing on which to base their decisions, meaning farmers and other agricultural producers are planting crops under no federal guidance.
Farmers and the U.S. farm industry continue to watch Congress wrestle with the Federal Farm Bill as the March 15 deadline looms. If the new bill is not passed, the 2002 bill could be extended to one or two years, placing new policies in the hands of the new president and Congress.
According to online discussion groups, House and Senate leaders have met behind closed doors this week to continue funding-level discussions. Realizing they will not likely meet the March 15 deadline, they've agreed in principle for a farm bill extension until April 18. This extension may move through the Senate and House as soon as today. Meanwhile, the discussions are focused on the $10 billion over the baseline funding level mark via possible rebalancing loan rates and target prices.
Up to now, the U.S House and Senate have passed separate bills, neither of which significantly addresses subsidy cuts. Both also increase spending and paying for that increase via revenue enhancements or new taxes.
These two issues appear to be a stake in the sand for President Bush. He has stated that he will veto any farm policy bill that raises taxes or provides subsidies to farmers with annual adjusted gross income more than $200,000.
At Clary Communications, we are watching this issue closely, and we will touch base with you with weekly status reports over the next month.
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