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Ag groups back conservation compliance

A coalition of conservation groups and farm and commodity organizations has agreed to back linking conservation compliance to eligibility for crop insurance premium subsidies in the Senate's 2013 farm bill.

"We're somewhat excited at where we're at and at how much ground we've crossed over to get to this point," said Earl Garber, president of the National Association of Conservation Districts. NACD has been a supporter of conservation rules for crop insurance that are similar to those required for USDA commodity programs, but it has had concerns about the financial effect on farmers as well.

"You have to keep your landowners and producers viable financially," Garber said.

In return for supporting relinking rules against farming highly erodible land and wetlands in return for crop insurance support, commodity groups got a concession from conservationists: the coalition opposes any means testing, payment limits or reductions on premium subsidies for high-income farmers

Last year, when the Senate agriculture committee wrote a farm bill, it had neither conservation compliance nor cuts in insurance subsidies to large farms. When the committee bill was passed in the full Senate, an amendment sponsored by Senators Dick Durbin (D-IL) and Tom Coburn (R-OK) was added that would reduce premium subsidies by 15 percentage points for farm owners with more than $750,000 in adjusted gross income. Another amendment sponsored by Senator Saxby Chambliss (R-GA) tied conservation compliance to crop insurance, something that had been a requirement in the 1985 farm bill but was dropped in the 1996 law when Congress mandated carrying crop insurance to be eligible for disaster payments. Last year's bill was introduced as a starting point for a 2013 bill by Senate Majority Leader Harry Reid in January.

Garber said he's not certain if the new compromise language will be in the draft of farm bill that will be released by Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI) before the committee meets next Tuesday to vote on a bill. He's optimistic that it will be included somehow, since it was Stabenow's committee staffers who urged the groups to work on a compromise.

The coalition of 32 organizations includes major farm groups such as American Farm Bureau Federation, National Corn Growers Association, American Soybean Association, and National Farmers Union. Other conservation groups backing it are Pheasants Forever, National Wildlife Federation, and the Theodore Roosevelt Conservation Partnership. The American Association of Crop Insurers supports it as well.

Groups that have worked to get compliance relinked, including American Farmland Trust, also signed on to a letter sent to Stabenow. The National Sustainable Agriculture Coalition (NSAC) did not.

"Conservation accountability should apply to the entire farm safety net.  Reasonable limits and actively engaged in farming rules should apply to all crop subsidies," NSAC policy director Ferd Hoefner said in a message sent late Monday. "These are fundamental principles supported by the farmers we represent.  We therefore do not support the deal. We may not even support the conservation portion of the deal which appears to include major loopholes, though we will need to see actual legislative language before making a definitive judgment on that score.  We will continue to pursue amendments that support both bedrock principles as the farm bill process continues."

Hoefner said that the compromise deal would allow farmers to receive crop insurance subsidies by signing the same Form 1026 that farmers now sign to self-certify that they meet conservation rules in order to receive commodity program payments. But the agreement says that if USDA doesn't evaluate Form 1026 in a timely way, and the producer is shown in violation of the law later, he or she would be held harmless. Depending on how the bill is actually written, that could be a giant loophole.

The current system for farm programs is almost an honor system. Hoefner said the USDA spot checks fewer than 5% of farms for conservation compliance. "Maybe in less than 20 years, somebody checks to see what you're doing," he said.

Hoefner said many of the other rules agreed to by the coalition make sense, but his group also backs the Durbin-Coburn amendment, which was estimated to save about $1 billion in federal spending over the next decade.

Among the recommendations of the 32 groups now backing conservation compliance is that "Producers who break up or violate a conservation plan on highly erodible land or drain or improve the drainage of a wetland should not become ineligible for premium assistance in the year of the infraction.  Crop insurance companies and producers have already incurred expenses and made major borrowing commitments at that time.  It would be difficult and administratively burdensome to change the insurance policy mid-stream.  Instead, no premium assistance should be available to the producer the following crop insurance year or until the infraction has been corrected or appropriately mitigated.   Furthermore, it is critical that premium assistance not be denied until all appeals to USDA’s National Appeals Division have been exhausted."

Garber said that producers who have drained small amounts of wetlands--fewer than 5 acres per farm--after conservation compliance takes effect would have the option not restoring that wetland and paying the Natural Resources Conservation Service 150% of the cost of mitigation. NRCS would use that money to create wetlands elsewhere. Under the compromise agreement,  producers who don't meet conservation compliance rules would still be able to buy crop insurance, but would be denied any subsidy for premiums. The current federal subsidy for premiums averages more than 60%.

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