Ag committee to tighten subsidy eligibility

Jun 3, 2011
by DTN

In a signal of the growing unpopularity of farm programs, the House Appropriations Committee last Tuesday approved amendments to the fiscal year 2012 appropriations bill to impose stricter income limits on farmers who get commodity payments.

The committee approved a bill to provide the fiscal year 2012 appropriation for the Agriculture Department, the U.S. Food and Drug Administration, the Commodity Futures Trading Commission (CFTC), and the Farm Credit Administration.

The bill provides a total of $125 billion, including mandatory USDA programs such as farm subsidies, food stamps and school lunch programs, and including $17.2 billion for discretionary programs at the four agencies.

For farmers, the biggest change comes in an amendment offered by Rep. Jeff Flake, R-AZ, to limit the incomes of farmers who get subsidies to $250,000 per person or entity, compared with $750,000 at present. Flake has proposed the income limit in previous years and lost, but this year, won on a voice vote.

The committee also adopted an amendment by Flake to fund the $143 million payment that the U.S.

makes to Brazil for damages to its cotton farmers under a World Trade Organization (WTO) settlement.

Those payments would come from the direct payments that U.S. cotton farmers get, rather than from other USDA funds. The amendment passed on a voice vote.

Flake told reporters after the markup that the direct payments are “the fattest target out there” and cannot be defended since farm incomes are up 20 percent this year.

National Cotton Council lobbyist John Maguire declined to comment after the vote on direct payments.

There was no major debate over the size of the bill.

House Agriculture Appropriations Subcommittee Chairman Jack Kingston, R-GA, emphasized that the bill’s discretionary funding would be less than in previous years, but that the overall bill would still be higher than last year by $280 million due to increased spending on nutrition programs.

Democrats led by House Appropriations Committee ranking member Norm Dicks, D-WA, and Sam Farr, D-CA, said the bill did not provide enough money to feed poor people and deal with many problems in rural America.

Kingston noted that the bill contains a provision to make sure that farmers who use futures are not considered swap dealers. The bill provides much less than the Obama administration requested to pay for the CFTC implementation of the Dodd-Frank financial services reform bill, and Rep. Marcy Kaptur, D-OH, said she would probably offer an amendment on the floor to provide more money for CTFC to enforce that law.

Rep. Rosa DeLauro, D- CT, proposed that the money that would be paid to the Brazilians be used to increase funding for the Women, Infants and Children (WIC) program, and that measure also passed on a voice vote. DeLauro said there was no conflict between her measure and Flake’s because her amendment, which said the cost of the Brazil program is $147 million, would apply to fiscal year 2012, while Flake’s shift to direct payments as a funding source would apply to fiscal year 2013.

DeLauro said she realized that not making the payment to the Brazilians would make the U.S. out of compliance with its agreement with Brazil to settle the WTO case.

The issue of horse slaughter drew debate as well. The subcommittee-approved draft of the bill did not contain a provision banning the inspection of horse meat for consumption that has been in each Agriculture appropriations bill since 2006, but Rep. Jim Moran, D-VA, offered an amendment to include it. Kingston and Rep.

Cynthia Lummis, R-WY, opposed the measure on the grounds that the ban has led to the shipment of horses to Mexico and Canada for slaughter. Still, the measure passed on a roll call vote of 24-21.

The committee also engaged in a long discussion of whether more money is needed for the WIC program to assure that all women and infants who qualify for the program get served, and what percentage of the program’s budget is used for administrative expenses.

Kingston said the bill had provisions to make sure everyone gets served, but also said he is concerned that people are eligible for too many nutrition programs, and that the programs should be combined.

DeLauro presented a letter from Agriculture Secretary Tom Vilsack saying that hundreds of thousands of women and infants could be denied coverage, but the committee did not change the funding allocation.

Democrats and Rep. Jo Ann Emerson, R-MO, said they were concerned about a cut in the international food aid budget for emergencies, and Kingston said he is working on a proposal to allow 20 percent of the budget for development aid to be used for emergency food aid.

The committee also adopted by voice vote a Kaptur amendment to transfer $1.2 million in unspent USDA administrative funds to the Rural Energy for America Program. — DTN