Conaway Pledges ‘No Drama’ Farm Bill Process

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By Casey Wooten

Work on the next farm bill is getting started in earnest.

House Agriculture Committee Chairman Mike Conaway (R-Texas) gave a broad outline on how his panel will tackle the upcoming five-year policy vehicle, digging into key policy proposals during a keynote speech at the Department of Agriculture’s 2017 Agriculture Outlook Forum on Feb. 23.

Conaway called for minor changes to farm aid programs created as part of the 2014 farm bill, along with an overhaul of the Supplemental Nutrition Assistance Program, commonly called the food stamp program. Conaway said he expects Congress to complete the legislation by its deadline of late 2018 and to work past the divisions over SNAP that kept the 2014 farm bill from passing on time.

“If you like the drama associated with expirations and short-term extensions and all that kind of stuff, and permanent law coming back into existence, then you need to go find a different theater, because we don’t need that drama,” Conaway said.

Beginning in March and April, the panel’s subcommittees will hold two farm bill hearings, Conaway said. The committee will also head out to hold listening sessions with stakeholders in the agriculture sector.

SNAP Program

Conaway pledged to “propose meaningful reforms” to SNAP in the upcoming farm bill talks.

While benefits for the elderly and disabled will remain, House Republicans will focus on transitioning able-bodied recipients with no dependents out of the program, he said. The plan might also include stronger work requirements and employment training programs.

“If the policy is correct and it incentivizes people to go back to work and stay at work, then that’s the policy that we want to pursue,” Conaway said.

The Agriculture Committee recently completed a two-year study of SNAP, concluding that while there is no need to “gut” the program, there is room for change.

But cuts to SNAP were the driving force in delaying the 2014 farm bill and any revamp might stoke the same partisan divisions. Then, House Republicans split the farm bill in two, separating SNAP from the farm aid provisions while also reducing payouts. That effort failed to get traction in the Senate and the farm bill that Congress ultimately passed had both programs reunited.

ARC, Dairy, Cotton

Conaway also said his committee will make small changes to two aid programs created in the 2014 farm bill: the Price Loss Coverage and Agriculture Risk Coverage programs.

Those programs provide aid to farmers based on when the price of a particular crop or the average country-wide revenue from a crop falls below a pre-determined amount.

Some farmers have criticized those programs, especially ARC, saying the county-wide metric can be inaccurate and creates disparities in payments.

“It will be more the idea of fine-tuning those two,” Conaway said.

Conaway supports including cotton under the list of commodities supported by Title 1, the section of the farm bill that covers price and income support programs like ARC and PLC.

“I believe there’s a path forward to make that happen,” Conaway said.

Congress removed cotton from Title 1 commodities in the 2014 farm bill in part because of a trade dispute with Brazil.

Also up for change is another 2014 farm bill initiative, the Dairy Margin Protection program, Conaway said.

The program gives financial assistance to enrolled dairy farmers if profit margins fall below a particular threshold. Farmers pay an annual fee based on the amount margin protection they want, with $4 per hundredweight of dairy being the lowest.

The program has come under criticism from some dairy farmers, who say that because the method used to calculate the profit margins uses nationwide data, it doesn’t take into account region-specific costs.

“The dairy program didn’t work as well as we wanted to,” Conaway said.

Conaway said he is focused on getting more dairy farmers to enroll in the program, and he is open to both changing the length of enrollment or the method of calculation, saying that a “one size fits all” metric across the country causes distortions.

In a House Agriculture Committee hearing Feb. 15, committee ranking member Collin Peterson (D-Minn.) suggested that the program have a five-year enrollment period instead of being annual.

Senate Hearing

Halfway across the country, the Senate kicked off its work on the farm bill.

Agriculture Committee Chairman Pat Roberts (R-Kan.) and ranking member Debbie Stabenow (D-Mich.) held a field hearing in Manhattan, Kan., where farmers, mostly growing major commodities like corn, soybeans and livestock, echoed much of what Conaway was saying.

Lynda Foster, a Kansas dairy farmer, called on the committee to rework the calculation method the Dairy Margin Protection program uses for payouts to boost participation.

“We need Congress to act swiftly this year and make the necessary changes in order for our industry to be able to protect ourselves from the bad year that could arrive at any time, even in years where experts are predicting higher margins,” she said.

The dairy industry isn’t facing as dire a situation as crops such as wheat and soybeans, which have experienced record yields and low prices. A drop in feed costs and improved milk prices are expected to push dairy margins up in 2017, with margins hovering around $10, according to the USDA.

Kansas soybean farmer Lucas Heinen called on Roberts’s committee to change the metrics used in ARC to nationwide USDA data, which he said would minimize county-by-county changes in payments.

“This could incur some additional cost, but it would make this important program more accurate and defensible as an option in the next farm bill,” Heinen said.

Heinen also pushed for Congress to double funds for the USDA’s Foreign Market Development program and the Market Access Program, which have been frozen for 10 years. Those programs promote and expand markets for U.S. agriculture products overseas.

Tax Overhaul

Aside from the farm bill talks, Conaway also encouraged the farmers to hold off on criticizing the Trump administration’s plan to overhaul the tax code until they see the proposal in its entirety.

Some in the agriculture sector are concerned that Trump’s calls for a border adjustment tax, which would levy taxes on certain imports to the U.S., would spark retaliation from major agriculture trade partners like China and Mexico.

Conaway said farmers should “keep their powder dry,” and wait for Congress to unveil specific legislative language.

“You can cherry-pick pieces of the current code that we have and criticize those and beat those up, but until you are able to have a projection run of what the new tax code would look like as a package, you really don’t have a fair comparison of where we are right now.”

To contact the reporter on this story: Casey Wooten in Washington at cwooten@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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