Senate Joins Farm Bill Fray
Last Friday the Senate Committee on Agriculture, Nutrition and Forestry released its draft farm bill, kicking off the Senate’s effort to pass new omnibus legislation before some provisions of the current law expire in September. The Agriculture Improvement Act of 2018 (“AIA”), which arrives on the heels of the House’s failure to pass its own partisan farm bill last month, rejects the worst provisions of H.R. 2. Opportunities remain for the Senate to improve the AIA so that the next farm bill creates opportunity for all farmers, provides a robust safety net against hunger, and conserves the health of our shared natural resources. Amendments will be considered during the full committee markup tomorrow, and again when it reaches the Senate floor toward the end of this month.
On the whole, the Senate bill rejects the partisan approach of the House bill, which would cut the food safety net, terminate key conservation programs, and upend support for local food systems, sustainable agriculture, and limited resource farmers, among others. Instead, the AIA would largely extend the provisions of the 2014 Farm Bill with some important tweaks. It embodies the common wisdom that farm bills tend to be “evolutionary rather than revolutionary.”
Unfortunately, preserving the status quo means that the bill falls short on many systemic issues FBLE grapples with in its reports, and in some cases the AIA actually reverses hard-won progress. On the other hand, the bill makes modest but meaningful advances in many areas by embracing a number of FBLE’s policy recommendations and setting the stage for more effective farm bill policy down the road.
Food Access, Nutrition, and Public Health
The AIA protects the Supplemental Nutrition Assistance Program (“SNAP”) as the nation’s most vital and successful anti-hunger program. Where the House bill would expand work requirements and cause over 2 million people to lose benefits, the Senate bill makes no cuts to eligibility for low-income Americans.
FBLE’s report, Food Access, Nutrition, and Public Health, explains how, although SNAP already includes work requirements, those requirements currently apply to “able-bodied adults without dependents” (ABAWDs) between the ages of 18 to 49. FBLE recommends eliminating work requirements for ABAWDs altogether because the evidence shows that SNAP does not cause people to work less. Although the AIA would maintain existing work requirements, it at least avoids putting food security further out of reach for a new class of SNAP recipients by increasing those requirements.
Beyond protecting SNAP from harmful changes, the AIA includes provisions that would strengthen and enhance SNAP. FBLE encouraged Congress to look at how technology could reduce the burdens—on SNAP families and on government—of participation in and administration of the program, respectively. The Senate bill takes several steps in the right direction.
For example, the AIA instructs USDA to give farmers’ market vendors new options for accepting EBT, or electronic benefits transfer, which SNAP recipients use to purchase food. This could help lower a longstanding barrier of operating efficient and cost-effective SNAP EBT systems at farmers’ markets. Another provision would examine the cost effectiveness of new tools to verify household income. It is research that could lead to widespread adoption of simplified methods that reduce unnecessary paperwork burdens while keeping eligible households enrolled in the program.
The Senate bill reaches further than technical improvements to SNAP and makes modest investments toward FBLE’s vision of a farm bill that improves public health and increases access to healthy, nutritious foods, especially among vulnerable populations and rural communities. Notably, the renamed Gus Schumacher Food Insecurity Nutrition Incentives program (FINI) would receive mandatory permanent baseline funding of $50 million per year, more than double the $100 million FINI received over the previous five years combined. FINI promotes healthy choices among SNAP participants through “double bucks” and other incentive programs that increase the purchasing power of SNAP benefits.
Food Is Medicine
Finally, the AIA embraces FBLE’s recommendation to improve health outcomes of low-income individuals living with serious diseases by establishing a food is medicine pilot. The new “Harvesting Health” program would pilot efforts to connect low-income patients with the fresh produce prescribed by healthcare professionals. FBLE recommends a more targeted pilot that focuses on the provision of medically-tailored meals for chronically sick individuals—a recent study found a 16% net reduction in monthly healthcare spending for individuals receiving home delivery of medically tailored meals. However, the Senate bill’s embrace of “food is medicine” is at least a toe in the right direction, and includes critical provisions for data collection and analysis that will improve program design down the road.
Diversified Agricultural Economies
FBLE’s report, Diversified Agricultural Economies, explains how the farm bill can begin to correct a history of USDA discrimination while bringing a new generation into U.S. agriculture. In particular, beginning, minority and women farmers need access to retail markets, credit, agricultural insurance and land. The AIA takes modest steps toward each of these four goals.
Access to Markets
Recent farm bills supported investments in expanding direct market opportunities between farmers and their customers. FBLE recommends that Congress build on the incredible success of the Farmers’ Market and Local Foods Promotion Programs by increasing mandatory funding from $30 million to $50 million per year, which would elevate the program to the more permanent status that it has earned. The Senate bill achieves the same end by consolidating FMLFPP with the Value-Added Producer Grant program to create the Local Agriculture Market Program (LAMP). LAMP would receive $60 million per year in permanent mandatory funding, forever enshrining the most important USDA programs that connect farmers to the growing demand for fresh, local and organic food.
Further protecting the growth of new markets—and in contrast to the House bill—the AIA also maintains the Organic Certification Cost-Share Program (OCCSP), which reimburses farmers up to $750 to help defray the cost of organic certification. As recommended in more detail by FBLE, Senators should consider additional changes to help small, beginning and minority farmers better use this cost-share to access growing organics markets.
Access to Credit
The best way to ensure that producers can grow and adapt into new markets is to provide reliable access to credit. FBLE recommends that Congress take steps to increase outreach to socially disadvantaged and beginning farmers and ranchers to increase participation rates in USDA programs, especially credit programs. The Senate bill would combine the Section 2501 Program, which helps minority farmers access USDA resources, and the Beginning Farmer and Rancher Development Program into a new program called the Farming Opportunities Training and Outreach Program (FOTOP). The new program would receive $50 million per year in permanent funding, an increase over previous years that would not be subject to the vagaries of Congress’ annual appropriations process.
Insurance and Land
Finally, the AIA includes several FBLE recommendations to improve access to insurance and land for small, beginning and minority farmers, especially those growing in diversified production systems (e.g., many crops, or crops and animals together). The Senate bill makes important improvements to the Whole Farm Revenue Protection program by improving agent compensation and requiring more education and outreach about this critical tool for diversified producers. Farmers looking to buy or lease land could continue to rely on the CRP Transition Incentive Program, which receives a small increase in funding to $10 million per year over the next five years.
Productivity and Risk Management
Commodities and Crop Insurance
The Senate draft misses the opportunity to reform the system that disproportionately subsidizes the largest farms through commodity and crop insurance programs. FBLE recommends commonsense reforms that would level the playing field among farmers and allow smarter and more robust investment in our soil health and water quality.
Instead, the AIA leaves core provisions of the crop insurance program unchanged (although see important reforms to the whole Farm Revenue Protection program, noted above). By maintaining the status quo, the Senate fails to apply any income test or subsidy limit to insurance premium subsidies, or to rein in the excesses of insurance products that allow environmental and financial risk-taking on the public’s dime.
The bill’s approach to the major commodity programs, ARC and PLC, reflects a similar passiveness. These programs pay commodity producers when revenue or yield fall below certain benchmarks. FBLE recommends strengthening the limits on who can receive these payments. The Senate bill makes a nod to this concern by adjusting the means test to prevent anyone making over $700,000 in adjusted gross income (AGI) from receiving subsidies, down from $900,000. However, the bill fails to close the existing loopholes that allow nearly anyone with a tenuous connection to a large farming operation to receive up to $125,000 in annual subsidy payments. Lawmakers will have another chance to clarify the definition of who is “actively engaged” in farming, and therefore eligible for payments, when the bill is considered by the Committee on Wednesday. Senator Chuck Grassley (R-IA) is expected to push for an amendment that passed both houses of Congress in 2013 but was stripped out of the final bill.
Limiting wasteful and even counterproductive subsidies would allow Congress to invest more in sustainable farming practices. FBLE’s report Productivity and Risk Management identifies opportunities for the farm bill to continue to update and improve its conservation agenda across the core areas of conservation compliance, working lands programs, and retirement programs.
FBLE recommends critical updates to the mandatory conservation compliance requirements that guarantee minimum conservation standards on farms receiving farm bill subsidies. An analysis of USDA data out last week confirms “serious deficiencies in conservation compliance implementation, a failure to enforce conservation compliance in many states, and problems with how USDA verifies that farmers are taking the necessary steps to comply.” The first draft of the Senate bill fails to reckon with these deficiencies.
There are winners and losers among the voluntary conservation programs. The Conservation Reserve Program (CRP), which makes rental payments to farmers who fallow environmentally sensitive land, would sustain enrollment around 25 million acres. FBLE has critiqued CRP, noting that once CRP acres re-enter production, most if not all conservation benefits disappear. For this reason, FBLE recommends transitioning the most environmentally sensitive CRP acres into permanent easements. The Senate bill makes a down payment on this approach by authorizing permanent Conservation Reserve Easements on a narrow subset of protected acres, and this approach should be expanded to acres under CRP.
On working lands—that is, land under active production—the Conservation Stewardship Program (CSP) helps farmers cover the cost of adopting new conserving practices. FBLE recommends increasing funding to CSP, with a particular emphasis on the highest-impact activities like resource-conserving crop rotations. The AIA rejects the House’s dismantling of CSP, but still makes a $1 billion cut on top of previous cuts from the 2014 Farm Bill. The Senate bill also cuts the other major working lands program, the Environmental Quality Incentives Program (EQIP), by about $1.5 billion. This cut to EQIP comes with a small silver lining; namely, it adopts FBLE’s recommendation to decrease the amount of EQIP funding earmarked for livestock operations, much of which subsidizes concentrated animal feeding operations.
There are a few other bright spots within conservation. The Senate draft includes small but significant increases to smaller conservation programs. The Agricultural Conservation Easement Program would have much of its funding restored after its consolidation in 2014. In addition, the Regional Conservation Partnership Program would receive the additional scope and funding recommended by FBLE. RCPP, which provides technical and financial assistance to carry out projects at state or regional scales, would receive more guaranteed funding. States would also receive greater control to direct resources toward local and regional conservation priorities.
Research and Pilot Programs
Finally, the Senate bill would begin the critical process of establishing and measuring the links between crop risk and soil health. FBLE recommends that Congress give USDA the mandate and resources to adjust crop insurance premiums to reflect a broader notion of risk management activities. The AIA would take two important steps toward this goal. First, it would direct USDA’s Risk Management Agency (RMA) to research and analyze the relationship between crop yield, risk and soil types. Second, it would create a data warehouse that academic researchers could use to analyze crop yield, soil health, risk, and profitability data from RMA. These are crucial first steps toward incorporating soil health into the financial incentives that producers depend on most so that the public can begin to see a more robust return on its investment in farm subsidies.