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Johanns releases part of USDA's farm bill language

Agriculture.com Staff 04/25/2007 @ 3:36pm

Agriculture Secretary Mike Johanns announced Wednesday that the USDA has submitted legislative language for the conservation and credit titles of the next farm bill to Congress.

Johanns' offer to help write the farm bill has gotten a mixed reception on Capitol Hill. Last week the ranking Republican on the Senate Agriculture Committee, Saxby Chambliss of Georgia, said he doesn't think that is the role of the Administration but the committee's chairman, Iowa Democrat Tom Harkin, said he welcomes the input.

Johanns said Wednesday that the conservation title that USDA proposes would spend $7.8 billion more over the next 10 years on conservation that would be allowed if spending under the current farm law carried forward under a spending baseline. The conservation title would put several small conservation programs into EQIP, the environmental quality incentives program, mainly to simplify the application process for farmers, Johanns said.

It also includes $500 million over 10 years to expand the Conservation Security Program from 15 acres currently enrolled to 96 million acres, Johanns said.

Many of the changes to the credit title are aimed at helping beginning farmers, Johanns said. It would change the existing Beginning Farmer and Rancher Downpayment Loan Program by cutting the interest rate in half to two percent, deferring the initial payment for one year and increasing the maximum loan value.

When asked how the Administration proposes to pay for increased spending on conservation, Johanns said that "we got a little leeway on the baseline" from the administration's Office of Management and Budget. The administration proposes spending $5 billion over the baseline on the next farm bill, but it would still fit within its goals of reducing the federal spending, Johanns said.

The proposal also would make some changes in spending on commodity programs that would save money. For example, it's proposing that posted county prices for loan deficiency payments be made monthly instead of daily. That would save an estimated $250 million over 10 years, the USDA estimates.

Johanns mentioned that the large LDPs collected when barge traffic was stranded on the Mississippi River after Hurricane Katrina are an example of the potential savings. Cash prices temporarily fell from about $2 a bushel for corn to as little as $1.60, Johanns said. Farmers were able to collect large LDPs. "It cost a number of billions of dollars," he said.

It was all perfectly legal, but "I don't think it fit within the Congressional intent to provide a safety net," Johanns told Agriculture Online.

Another reporter asked Johanns what he thinks of a suggestion by Senator Harkin that some money from the direct payment program might be used to fund improvements in conservation programs.

Johanns said that right now he thinks the USDA has the right balance between conservation and commodity programs but that he's willing to consider other ideas, too, and he'd like to learn more about Harkin's concept. "He's a thoughtful guy," Johanns said of Harkin, "...so I'm kind of anxious to see a little more flesh on the bone."

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