South Dakota Ag Law - Farm Bill Update

Posted on Dec 10, 2013

With the number of days that the Congress will be in session the remainder of the year dwindling away, it is looking more likely that there won’t be a new Farm Bill. The Senate passed its bill last June (S. 954) and the House passed their bill in September (H.R. 2642). The two versions differ vastly and it just doesn’t look likely that a compromise can be reached by the end of the month. 

Differences remain on crop insurance, the replacement mechanism for direct payments and various other provisions. Also, a major sticking point is the Food Stamp program. Historically, Food Stamps have been included in the Farm Bill for purely political reasons – to get non-farm legislative support for its passage. But, in reality, the only true way to reform farm programs is to pull Food Stamps out of the Farm Bill and deal with it in separate legislation or make reauthorization of the Food Stamp program (if included in the Farm Bill) come up for reauthorization at a time different than that for the actual farm-related provisions. Food Stamp spending has skyrocketed in recent years, with the 2012 amount doubling the 2008 amount. Neither the Senate nor House versions of the Farm Bill make any meaningful attempt to rein in Food Stamp spending. The House bill proposes a five percent reduction (according to the Congressional Budget Office (CBO), and the Senate bill a mere one-half of one percent (according to the CBO). 

Presently, recipients of Food Stamps don’t have to be working or looking for work. The House version of the Farm Bill does contain a provision that attempts to tie work requirements to receipt of Food Stamps, but the Senate version does not. Likewise, “broad-based categorical eligibility” allows Food Stamp recipients to avoid otherwise applicable asset eligibility tests. The House bill tries to bar such eligibility, but the Senate bill does not.    

As noted above, another sticking point is crop insurance. Crop insurance spending has also ballooned in recent years (according to the Government Accounting Office) from an average annual cost of 3.1 billion (2000-2006) to a projected $8.9 billion annually from 2013-2022 under present law. Neither the House nor Senate versions of the Farm Bill really do anything to deal with the increased subsidies that assist farmers in paying crop insurance premiums.

Source: CALT Update