September 5, 2017 at 3:32 p.m.
Congress must act on Farm Bill before year-end to avoid buying $38 milk
All of the uncertainty over the state of the Farm Bill made my visit to Washington, D.C. last week incredibly interesting. It was also a very successful visit, as far as lobbying goes; the Farm Bureau group I traveled with was able to meet with both Minnesota Senators and five of our Representatives.
As could be expected, the Farm Bill was the major topic of discussion in all of the lawmakers' offices.
The Senate passed its version of the Farm Bill last June and the House Agriculture Committee passed its own version shortly after. Since then, the bill has been stalled by Republican House leaders who have refused to bring the bill to the House floor for a vote.
At press time, legislators had just two working days left before leaving Washington until after the November election. With the current Farm Bill expiring Sept. 30, some legislators are scrambling for action on the Farm Bill before they leave.
Several legislators signed onto a petition introduced by Rep. Bruce Braley (D-Iowa) demanding that House leadership schedule the Farm Bill for a vote. House Agriculture Chairman Frank Lucas (R-Okla.) has drafted a three-month extension of the current Farm Bill. There is also a group of lawmakers seeking an extension of the Milk Income Loss Contract (MILC) program until a new Farm Bill is enacted.
Regardless of the sense of urgency to get something done, it is more likely that nothing will happen in the next two days. The petition introduced by Braley won't have enough votes to sway House leaders. While a three-month extension may pass in the House, Senate leaders - especially Debbie Stabenow (D-Mich.), the Senate Agriculture Committee Chairwoman - have said they won't pass a similar measure. Rep. Collin Peterson (D-Minn.) also said he wouldn't support an extension of any length.
At least part of the reason for the lack of support for a three-month extension is that, when the Farm Bill expires on Sept. 30, not much will happen. The crop insurance program will continue, conservation programs will continue, nutrition programs for needy people and the school lunch program will continue. Even dairy policy, which would normally expire with the Farm Bill, was written in the 2008 version of the Farm Bill to extend to Dec. 31.
The only industry that will be affected by the Sept. 30 expiration is the dairy industry. On Sept. 1, the MILC program reverted to the lower payment rates and lower volume cap of the 2002 Farm Bill and, on Sept. 30, the MILC program will end. Funding for the U.S. Dairy Export Council will also end on Sept. 30, which means no funds from the dairy checkoff can be used for export assistance.
The House's three-month extension plan would restore MILC to the pre-Sept. 1 levels and extend the program to Dec. 1. However, support outside Congress for an extension is scant. Most farm and commodity organizations, including both Farm Bureau and Farmers Union, are opposed to an extension of any length, because it will make passage of a full, five-year Farm Bill more difficult. And there is virtually no support for an extension amongst House and Senate Democrats, who feel the proposed three-month extension is merely a political move for Republicans hoping to secure votes before the election.
"This is strictly political cover, is all this is, to make it look like they're doing something, " Peterson told Roll Call last week.
Even Lucas has said the proposed extension is more about show and less about actually trying to get something done.
"I view a three-month extension as an effort to bring this to a focus in the lame duck," Lucas told POLITICO. "When we are back in lame duck we need to get our comprehensive work done."
Without action before the break for elections, the Farm Bill's next chance at passage will come during the lame duck session, which will likely begin in mid-November. Congress is facing one of its busiest lame duck sessions ever, with action still needed on several important pieces of legislation, including the tax extension bill that will determine estate and capital gains tax rates.
Even with the amount of work being pushed back to the lame duck session, the Dec. 31 expiration of dairy policy will almost certainly prompt action on the Farm Bill during that time. If Congress doesn't pass an extension of the current Farm Bill or a new Farm Bill, "farm commodity support policy will revert to a set of non-expiring provisions known as permanent law," according to a report from the Congressional Research Service.
These parity price provisions have been in place since the 1930s and 1940s, but modern Farm Bill policies take precedent, essentially suspending their rules.
For the dairy industry, a reversion to permanent law would set the government support price at a minimum of $38.63/cwt. and require the federal government to purchase manufactured dairy products at that price.
At first glance, a pay price of $38.63/cwt. might make dairy farmers smile, but the consequences of a support price that high would be disastrous for the industry. Not only would such purchases pose a significant cost to the federal government, they would result in a distortion of supply and demand and a flood of imports.
Essentially, three options remain for the Farm Bill. 1. Congress will pass a five-year Farm Bill during the lame duck session. 2. They'll pass an extension to allow more time for reaching agreement on the proposed Farm Bill. Or, 3. If the Republican party prevails in the Presidential and Senate races, lawmakers might try for an extension during the lame duck session that will allow them to rewrite a Farm Bill after the newly elected leaders are seated.
Supporters of the Dairy Security Act, which is included in both the Senate and House versions of the Farm Bill, should contact their Senators and Representatives and demand a vote on the proposed Farm Bill. Those in favor of other dairy policies should also contact their lawmakers and make their preferences known.
And, by all means, make sure you know where the candidates you're planning to vote for in the election stand on the Farm Bill before you go to the ballot box.[[In-content Ad]]
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