Farm Bill proposal holds promise for state

After years of being left out of U.S. farm programs, California's fruit, nut and vegetable farmers could finally get their due in the 2007 Farm Bill that directs the federal government to buy more specialty crops and increase spending on research, conservation and trade expansion.

U.S. Secretary of Agriculture Mike Johanns unveiled the Bush administration's Farm Bill proposal during a Feb. 1 stop in the San Joaquin Valley, the state's most productive agricultural region. His visit was part of a multi-state tour to discuss specifics of the plan, which Johanns touted as "more predictable and equitable for farmers."

"If you're here and you grow fruits and vegetable, I promise you, you will see a presence in farm policy today that you have never seen before," Johanns said to a packed house of about 200 farmers, ranchers and other agriculture representatives at the Stanislaus County Agriculture Center in Modesto.

Under the proposed bill, specialty crop growers could stand to gain nearly $5 billion in benefits, including $3.2 billion from increased purchases of fruit and vegetables for food assistance programs, school meals and other nutrition programs.

Another $1 billion would go to specialty crop research, with emphasis on plant breeding, pest control and other related areas. California farmers could also benefit from nearly $400 million dedicated to trade programs, including a $250 million boost in the Market Access Program, which promotes exports of farm products.

Heeding President Bush's call to increase the nation's production of alternative fuels by 2017, Johanns said the proposed Farm Bill would provide $1.6 billion in new funding for renewable energy research to support development of cellulosic ethanol. The effort would take pressure off corn, the main ingredient of ethanol, and allow other plants such as switchgrass and farm wastes such as prunings and rice straw to be used in ethanol production.

The high price of corn spurred by strong demand for ethanol has been a huge concern for many livestock farmers, who depend on the grain for feed.

"Our conservation and our renewable energy proposals will work well for California," Johanns said. "We are targeting our funding in this Farm Bill toward cellulosic ethanol. Our hope is that that will really take off during the life of this next Farm Bill."

The plan also supports $2.1 billion in guaranteed loans for cellulosic projects and includes $500 million for a bio-energy and bio-based product research initiative. In addition, the proposal provides $150 million to speed development of new technologies to use low-value woody biomass to produce energy.

It is significant that specialty crops received a sizable share of the proposed Farm Bill. Historically, farm programs have been geared toward crops grown by Midwestern and Southern farmers, with the majority of payments going to corn, rice, cotton, soybean and wheat.

The shift in emphasis may be a reflection of how the new proposals were crafted. The U.S. Department of Agriculture last summer conducted listening sessions in 48 states to seek input from farmers and ranchers on the 2007 Farm Bill. Johanns said he received more than 4,000 comments from the 52 forums.

"We built these proposals based upon what they told us," he said. "One of the things that they told us is that there were areas of agriculture very important to our nation and really hadn't had a place in any significant way in farm policy. And I took that to heart.

"These folks talked about additional funding for research, market promotions, phytosanitary issues, purchase of fruits and vegetables so we could promote what we say is good for you in our nutrition guidelines and our food pyramid," said Johanns. "And all those things now are in this Farm Bill."

The overall plan would cost $87.3 billion over the next five years, not counting food stamps and other nutrition programs, compared with $105 billion spent on farm programs in the 2002 Farm Bill, set to expire at the end of the year. Johanns said the proposed bill upholds the president's plan to eliminate the national deficit in five years.

The final bill, which would take effect in January, will be written by Congress and could change as it moves through the House and Senate, where Midwestern states have the most clout.

The toughest sell may be the administration's proposal to eliminate farm payments to landowners who make more than $200,000 in adjusted gross income. The change would affect about 80,000 producers and save about $1.5 billion over 10 years. The plan also sets the subsidy payment limit for farmers at $360,000.

"Payment limits in southern states are just generally not well received," said Johanns. "We believe that our proposal makes a lot of sense. In the end, it will impact about 2.3 percent of farmers assuming they are representative of what the nation is as a whole."

Other highlights of the proposals include:

• Increase conservation funding by $7.8 billion by simplifying and consolidating programs and creating new Environmental Quality Incentives and Regional Water programs.
• Provide $1.6 billion in loans and $500 million in grants for rural communities to rehabilitate more than 1,200 current Rural Critical Access Hospitals, decrease the backlog of rural infrastructure projects and consolidate and simplify rural development programs.
• Support for socially disadvantaged farmers and ranchers by reserving a portion of conservation assistance funds for these producers and providing $250 million to increase direct payments by 20 percent for five years for beginning farmers and ranchers.
• Improve disaster relief by creating a revenue-based counter-cyclical program; ensure gap coverage in crop insurance; link crop insurance participation to farm program participation; and create a new Emergency Landscape Restoration Program.

(Ching Lee is a reporter for Ag Alert. She may be contacted at clee@cfbf.com.)

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