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Stabenow not enthused on crop insurance changes

DANIEL LOOKER 06/20/2012 @ 9:57am Business Editor

Senate Agriculture Committee Chairwoman Debbie Stabenow said Wednesday that  she doesn't think an amendment to tie conservation rules to crop insurance eligibility will pass when the Senate takes up the farm bill again today.

Speaking to reporters in a telephone press conference, Stabenow pointed out that the farm bill's new Agriculture Risk Coverage shallow loss program will be tied to farmers meeting conservation standards, as will marketing loans.

"Anything in the commodity title is tied to conservation compliance," she said.

Conservation rules weren't applied to crop insurance when her committee drafted the Senate's farm bill, she said, "primarily because crop insurance is a different kind of entity. It is a private insurance program that people purchase into."

As farm policy moves in the direction of risk management, Stabenow said the committee wanted to be certain that farmers participate in the crop insurance program.

"We want to incentivize farmers to purchase crop insurance," Stabenow said.

It is heavily subsidized, with the federal government paying 62% of farmer premiums, on average. And its total cost over the next 10 years is projected at about $9 billion annually.

Senator Tom Coburn (R-OK), who is looking for ways to a decrease the federal deficit even more than the $23 billion in cuts in the committee's bill, has offered an amendment that would make farmers with more than $750,000 in adjusted gross income pay more for insurance. His amendment, to be considered today or tomorrow, would trim the premium subsidy by 15 percentage points.

In a statement on the Senate floor Tuesday, Coburn said he thinks it's unfair that "the average hard working American is paying for 62%" of the premium for those high-income farmers.

"There is no other business in this country where you're guaranteed that your revenue and profit will be there," he said, referring to revenue protection crop insurance.

When asked about the amendment Coburn is offering, along with Senator Dick Durbin (D-IL), Stabenow said she is concerned about how it might affect the crop insurance system. "I'm cautious right now," she said.

She said the effects that premium limits might have on crop insurance need to be studied, and that she is concerned about the potential effects on small and medium-size farms.

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