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May 9, 2008

NATIONAL AFFAIRS:

Farm Bill Finalized, Veto Likely - House and Senate negotiators on Wednesday said they have reached agreement on the farm bill and will ready the bill for consideration by the full House and Senate next week, but they appear headed toward a showdown with President Bush. In a press conference Thursday Republican and Democrat Agriculture Committee leaders announced a final conference committee agreement Chairman Harkin stated that "it's a bipartisan bill and a multi-regional bill." The press conference was attended by Senate Ag Chairman Harkin (D) and House Ag Committee Chairman Peterson (D), Ranking Members Goodlatte (R) and Chambliss (R), as well as House and Senate tax committee Chairmen Baucus (D) and Rangle (D). The bill, entitled The Food, Conservation and Energy Act of 2008, includes; farmer safety net programs; rebalances loan rates and target process; a state-based revenue program; increased funding for the Environmental Quality Incentive Program and Conservation Security Program to the tune of $4 billion; new payment limits; and a first time livestock and specialty crop titles. New fruit and vegetable programs will reach $1 billion, the highest ever in a farm bill. The $300 billion bill includes $10.4 billion in new money, all of which goes to nutrition programs, and no tax increases are included. By the numbers 73.5 percent of the bill funding goes to nutrition programs (compared to 66 percent in '02), 16.1 percent to commodity programs, disaster assistance and crop insurance (compared to 27.5 percent in '02 bill) and 7 percent to conservation programs (compared to 6.2 percent on '02). Bush met with Republican lawmakers on Wednesday, and "He made it clear he was still not there," said Bob Goodlatte (Va.), the senior Republican on the House Agriculture Committee. Saxby Chambliss (Ga.), the senior Republican on the Senate Agriculture Committee, said the agreement would eliminate direct payments to individuals who make more than $750,000 in annual adjusted gross farm income. Individuals who make more than $500,000 in nonfarm income also would be ineligible for direct payments. Last week, negotiators were considering a $950,000 cap on annual adjusted gross farm income. Bush aides most recently urged lawmakers to limit direct payments to individuals who receive less than $500,000 in annual adjusted gross farm income. Meanwhile, Chuck Conner, Agriculture Department deputy secretary, is reported to have told a gathering of conservative activists on Wednesday that Bush is likely to veto the farm bill. Anti-tax activist Grover Norquist said a veto would be popular with his fellow conservatives, who believe "this is a fight worth having" in advance of November elections. White House spokesperson Dana Perino said it "seems unlikely" Congress will produce a bill Bush would sign. "Therefore," Perino said, "the president would call on them to pass a one-year extension if they can't get to a point where they would pass a bill that he could sign." Farm Bureau opposes a one-year extension of the existing farm bill and supports enactment of a new farm bill now. Some say the farm bill has "become a defining issue of the last year" of Bush's presidency. Bush "regretted" signing the 2002 Farm Bill, in part because it undermined his image as a fiscal conservative. Senate Agriculture Committee Chair Tom Harkin (D-Iowa) said he is "hopeful" Bush will sign the legislation. "We've got to get the votes to override a veto, and we will," he said.  House Agriculture Committee Chair Collin Peterson (D-Minn.) said he believes the farm bill will get more than 300 votes in the House next week. All details of the farm bill will be available Monday morning. A vote in the House is expected by Wednesday. House Minority Leader John Boehner is expected to oppose the bill.

Capitol Hill Hearings Focus on Food Prices - A bipartisan chorus of lawmakers called for a rethinking of U.S. energy policy as it relates to ethanol during hearings this week. Under pressure to do something about surging food prices, members of Congress are increasingly questioning federal incentives designed to spur the ethanol industry.

Iowa State University's Bruce Babcock told lawmakers at one hearing that even if incentives for ethanol were abolished, it would not lead to a dramatic decline in food prices, Additionally, the quantity of ethanol produced would not diminish by much.  Farm Bureau is monitoring these hearings closely, and AFBF submitted statements for the record to recent hearings. In related news, 26 Republican senators have "rallied around" a request by fellow Republican and Texas Gov. Rick Perry to roll back part of the renewable fuels standard (RFS). Perry recently urged the Environmental Protection Agency to waive portions of the mandate as it relates to ethanol use this summer.  In response, Sens. Charles Grassley (R-Iowa) and Tim Johnson (D-S.D.) have drafted a letter asking federal regulators to maintain the current RFS. Farm Bureau urges senators to sign the Grassley-Johnson letter.

Pork Purchase for Food Assistance Programs - USDA announced that it will purchase up to $50 million of pork products for child nutrition and other domestic food assistance programs. AFBF and the National Pork Producers Council had requested the action in letters last month, in response to continued low prices for pork and live hogs. USDA's Agricultural Marketing Service administers a variety of commodity purchase programs for distribution by the Food and Nutrition Service. The procurement efforts are designed to stabilize the market for agricultural commodities while at the same time providing high-quality, healthful and nutritious food for domestic feeding programs.

HSUS Video Focuses on Downers in Auction Yards - The Humane Society of the United States on Wednesday released undercover video resulting from its latest "investigation on the mistreatment of farm animals." During a news conference in Washington, D.C., and a subsequent telephone conference, HSUS President and CEO Wayne Pacelle claimed the video shot by his organization showed that so-called downer, or nonambulatory, dairy cattle were being neglected by livestock auction facilities. Pacelle, however, stopped short of claiming those particular animals entered the nation's food supply. Farm Bureau monitored the telephone news conference, during which HSUS's motive for the latest video came to light fairly quickly. HSUS is asking Congress to pass a modified version of the legislation that bans slaughtering of nonambulatory livestock and requires humane euthanasia. Pacelle contends the "comprehensive anti-downer legislation" is warranted because animals at auction facilities and other intermediate points in the supply line "fall into regulatory limbo." According to Pacelle, the investigation exposes additional gaps. Overall, this HSUS splash was not as much of a flashpoint as the Westland/Hallmark incident earlier this year because it did not involve a huge meat recall or the school lunch program. However, it portrays the downer issue as widespread and unregulated. While, HSUS did not allege outright that these auction animals entered the food supply, by saying the problem is "systemic," which Pacelle repeated a few times during the news conference, he attempted to leave the impression that some nonambulatory cattle do enter the food chain.

STATE AFFAIRS:

Back with Black on Local Government Bill - Rocky Black, Senior Director of Policy and Political Affairs, Ohio Farm Bureau Federation (OFBF) testified as a proponent of HB 521, sponsored by Rep. Larry Wolpert. The bill creates the Ohio Commission on Local Government Reform and Collaboration. If the bill passes, the commission will be charged with offering recommendations on reforming and restructuring local government in Ohio.

Black told the panel OFBF has concerns over the make up of the commission and language in the bill that calls for "consolidation or elimination of local government offices." In general, Black testified, OFBF supports keeping government as limited and close to the people as possible.

Insurance Bill Brings Testimony from North Dakota Rep. - Chair of the National Conference of Insurance Legislators panel and North Dakota Republican Rep. George Keiser testified in support of HB 404 (Hottinger, Barrett). The bill is designed to prevent transactions in which investors offer to pay aging Ohioans for their life insurance policies. These transactions are referred to as Stranger Originated Life Insurance (STOLI) transactions. With certain exceptions, the bill will pass a five-year moratorium on the transfer of a life insurance policy.

Keiser told the Senate Insurance, Commerce & Labor Committee that they need to be sure to adequately define STOLI transactions within the bill. He also expressed concern about the five-year moratorium on transfers of policies in the bill.

Fee Increase for Dairy Processors - During a May 8 meeting, the Ohio Department of Agriculture's (ODA) Milk Sanitation Board (MSB) was advised that because of budget shortfalls, ODA will be receiving a $1.6 million budget reduction and that $182,000 of this reduction will apply to the dairy division. However, the division must maintain adequate levels of funding and support for its programs, and therefore to compensate for this reduction, proposed an increase in fees to be borne by processors and receiving/transfer stations, which the MSB approved.

Farm Bureau/OLC Welcome Over 100 Legislators & Candidates- On Tuesday, May 6, over 100 state legislators and candidates for next year's General Assembly met with representatives of Ohio Farm Bureau and the Ohio Livestock Coalition. The first "Ag Power Briefing" was held to inform policy makers about current issues within agriculture, such as Food and Fuel, Animal Care, Permitted Livestock Facilities, and Environmental Stewardship. Many important contacts were made between the ag industry and state leaders. Farm Tours and Biofuel Facility Tours were also arranged after the meeting.

Clean Ohio Group Courts Farm Bureau - A coalition of groups supporting the renewal of Ohio's $400 million Clean Ohio bond program has asked for Ohio Farm Bureau's support to pass the ballot measure in November.  The Nature Conservancy, Ohio League of Conservation Voters and the Ohio Department of Natural Resources are gearing up for a marketing campaign to pass the measure. Backed by the Strickland Administration and legislative leaders, the Clean program will include $50 million per year for farmland preservation, $50 million per year for development of bioproducts materials, $100 million for transportation improvements such as rail or other transport, and $50 million for advanced and renewable energy services.

CONTACT

Niki Clum

Director of Constituent Action

nclum@ofbf.org