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Senators appeal for disaster aid, extended capital gains tax deferment

Agriculture.com Staff 08/04/2006 @ 2:14pm

Farm state Senators today began two major bipartisan drought initiatives to bring crop and livestock producers relief.

The first is a request to Senate leadership for agreement on an agriculture disaster assistance package. The second is a letter to Secretary of the Treasury Henry Paulson requesting an extension in the capital gains tax deferment period for livestock producers forced to sell off parts of the herd.

In the letter sent late last night to Sens. Bill Frist, R-TN, and Harry Reid, D-NV, Sen. Pat Roberts, R-KS, and a bipartisan group of farm state senators said further disaster assistance is likely in the near future.

"Between now and the end of the Senate recess period, we will be working to put together a bipartisan package that we can take to the floor," the senators wrote. "One option may be to include drought assistance for crop year 2006 in the FY 2007 Agriculture Appropriations bill, which already contains disaster relief for the 2005 crop year and was passed by the Appropriations Committee on June 22."

In a letter to Paulson, the lawmakers said deferring capital gains taxes further will allow producers to recoup drought-related losses.

"Persisting drought conditions have left forage sources unfortunately scarce, and it is currently not in the best interest of livestock producers to replace livestock. However, these producers would be required to purchase replacement animals to avoid realizing the gain from their 2002 weather related livestock sales," they wrote today. "As such, an appropriate extension of the capital gains tax deferment period would allow producers to re-invest at a more reasonable and opportune time and help them avoid suffering further losses due to uncontrollable drought conditions."

Today's letters follow similar requests earlier this year on Capitol Hill for drought mitigation for farmers and ranchers. In May, Roberts, a senior member of the Senate Agriculture Committee, urged U.S. Secretary of Agriculture Mike Johanns to release Conservation Reserve Program (CRP) acreage for emergency grazing.

Farm state Senators today began two major bipartisan drought initiatives to bring crop and livestock producers relief.

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