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May 24, 2008

 

NATIONAL AFFAIRS:

Energy and Tax Extender Act Up For Consideration -The $57 billion Energy and Tax Extenders Act of 2008 was expected to be considered by the House this week, with the Senate Finance Committee taking it up after its Memorial Day recess. The bill includes several renewable energy and expiring tax credit provisions supported by Farm Bureau.

Renewable energy provisions include a one-year extension of $1 per gallon production tax credits for biodiesel and the small biodiesel producer credit of 10 cents per gallon. The bill eliminates the disparity in the credit between biodiesel and agri-biodiesel so that both will now receive a $1 credit. The bill would extend for one year the $1 per gallon production tax credit for renewable diesel fuel created from biomass. In addition, the bill extends for three years (through 2011) tax credits for closed-loop biomass, open-loop biomass, geothermal, small irrigation, hydropower, and landfill gas and trash combustion facilities used to produce electricity. A new three-year tax for marine renewables (such as waves and tides) used to produce electricity is included as well. The tax credit for wind facilities that produce electricity would be extended for one year. Another provision in the bill would reduce the current ethanol tax credit from 51 cents per gallon to 45 cents per gallon. A one-year extension of unrelated business income tax (UBIT) rules and the option to take an itemized deduction for state and local sales taxes in lieu of the itemized deduction would also benefit farmers and ranchers if the legislation is approved.

 

Congress Overrides Veto on Most of Farm Bill - The House and Senate on Thursday voted to override President Bush's veto of an incomplete the version of the farm bill vetoed by President Bush. The bill doesn't include the trade title originally approved by Congress, due to a last-minute paperwork glitch.

 

Also on Thursday the House voted to approve the complete conference report with a new bill number (H.R. 6124), on a voice vote of 306-110. Although the bill number is different, the legislation is identical to H.R. 2419. This "new" bill will now move to the Senate for a vote, which is likely to take place soon after senators return from recess in early June. After the Senate vote, it will take about three days to "enroll the bill" and have it sent to President Bush, who is expected to veto it shortly after he receives it. House and Senate members must then vote on overriding the veto of the complete bill.

 

Because the House and Senate have determined that 14 of the 15 titles of the farm bill are already law, there will be no short-term extension of the 2002 farm bill. Funding for soup kitchens will be one of the first provisions to take effect. Most of the changes to the commodity title won't really come into play until next year.

 

Because the farm bill glitch could not be fixed this week, the House will not be able to approve the 2009 budget resolution until June either. If the budget resolution had been finalized prior to completion of the farm bill, Congress would have been forced to use the March 2008 baseline rather than the March 2007 baseline – making it much more difficult to fund all necessary programs.

 

Senators Stand Up For Biofuels - Led by Sen. Chuck Grassley (R-Iowa), several senators held a press conference last week in Washington to "dispel myths of an ethanol smear campaign being conducted." Sens. Byron Dorgan (D-N.D.), John Thune (R-S.D.), Ben Nelson (D-Neb.) and Kit Bond (R-Mo.) participated in the press event.  In a media advisory, Grassley notes, "For almost 30 years, Congress has promoted policies to grow a domestic renewable fuels industry in order to lessen U.S. dependence on foreign oil and to improve air quality. Until now, there has been only support for these policies. Now, ethanol and other biofuels are being made a scapegoat for a whole variety of problems. But, none of these recent criticisms are based on sound science, sound economics or common sense." The senators discussed "a well-financed, well-coordinated ethanol smear campaign led by the Grocery Manufacturers Association that is undermining and denigrating the patriotic achievements of American farmers to reduce our dependence on foreign oil, while also providing a safe and reliable food supply," according to the advisory.

 

Food "Before" Fuel Group Hosts Press Conference - Under the moniker "Food Before Fuel," representatives from an array of groups, including the National Restaurant Association, Earth Policy Institute, National Retail Federation, Environmental Working Group, FarmEcon LLC, Grocery Manufacturers Association, Advanced Economic Solutions, National Turkey Federation and the National Council of Chain Restaurants, hosted press event last week urging Congress to "revisit food-to-fuel mandates." Visit the GMA Web site (http://www.foodb4fuel.com) for more info.

 

New Rule Revents Downer Cattle in Food Supply - Agriculture Secretary Ed Schafer last  Tuesday announced the agency will begin writing a proposed rule to prohibit the slaughter of all disabled non-ambulatory cattle, also known as "downer cattle." Put another way, Schafer said he is calling for the end of the exceptions in the so-called "downer rule". The current rule, which focuses on cattle that went down after they have already passed pre-slaughter inspection, has been challenging to communicate and has, at times, been confusing to consumers," Schafer said. Citing the need to maintain consumer confidence in the food supply, eliminate further misunderstanding of the rule and, ultimately, to make a positive impact on the humane handling of cattle, Schafer said he believes it is sound policy to "simplify this matter by initiating a complete ban on the slaughter of downer cattle that go down after initial inspection." USDA's Food Safety & Health Inspection Service (FSIS) is drafting a proposed rule to remove the exception that allows certain injured cattle to proceed to slaughter.

 

AFBF Addresses Role of Agriculture In Climate Change - AFBF has submitted comments to a subcommittee of the Senate Agriculture Committee regarding the role of agriculture in addressing climate change. The comments point out that any legislation addressing climate change by reducing greenhouse gasses will impose additional costs on farmers and ranchers, as well as consumers. A series of principles for consideration by legislators in climate change legislation is included in the comments.

 

USDA: Ethanol Has Limited Effect on Food Prices - Agriculture Secretary Ed Schafer and agency economists briefed reporters last Monday on "the case for food and fuel." During the press event, Schafer said, "We think the time has come for USDA to join in the public conversation about food prices and biofuels." He also said he has no sympathy for Republican senators who have expressed support for waiving the Renewable Fuel Standard (RFS). "Changing the Renewable Fuel Standard isn't going to change [plant] capacity any; it's not going to change the amount of corn that's being used for ethanol any," Schafer said. He explained the RFS does not dictate corn acreage, it dictates how much fuel will come from ethanol and what the percentage cap is on that. Schafer also noted, "Higher oil prices affect much more than the cost of driving; they are actually one of the major factors behind higher food costs. With all the recent focus on the impact that biofuels are having, this fundamental fact seems to get overlooked." A transcript of Schafer's remarks and a video link to the event are available online at USDA.gov.

 

STATE AFFAIRS:

Unanimous Support of Private Water Rights in the Senate -Sen. Tim Grendell's, R-Chesterland, constitutional amendment, SJR 8, received support from both sides of the aisle last week in the Senate. The House is expected to support the ballot initiative later this week. Grendell sponsored SJR 8 with the goal of reinforcing private property rights that he worries would be jeopardized if the General Assembly ratifies the Great Lakes Compact. If the House does pass the resolution, it is expected the Senate will pass the Great Lakes Compact, HB 416 (Dolan), this week.

 

Economic Stimulus and Clean Ohio Bills Moves Quickly - The bipartisan $1.57 billion economic stimulus package, HB 554, passed the House last week by a vote of 88 - 9. The package was announced by Gov. Ted Strickland, House Speaker Jon Husted, and Senate President Bill Harris earlier this year. The House also passed on the Clean Ohio ballot initative, HJR 5, by a vote of 94 -2. The bills were moving quickly through the Senate as well. Both bills have been reported out of the Senate Finance and Financial Institutions Committee and will likely receive a floor vote this week.

 

Ohio Farm Bureau has yet to take a position on either bill, however, the Board of Trustee is expected to consider the bills at their meeting next month.

The details of the bipartisan economic package are:

New and Emerging Industries:

• Bio-based Products, $50 million -- will help support and grow an industry that aims to produce polymers, plastics and other crucial modern materials out of Ohio-grown crops.

• Biomedical, $100 million -- will help create jobs through spurring a part of Ohio's economy that saves lives and leads to medical advances.

• Advanced and Renewable Energy, $150 million -- will create new jobs by making Ohio a powerhouse of renewable and advanced energy production such as wind, solar and clean coal.

Infrastructure:

• Logistics and Distribution, $100 million -- will help spur job creation through investing in infrastructure that can be used to expand and support businesses that move and distribute products. Ohio's central location in the nation makes it a perfect location for a growing logistics and distribution industry.

• Local Infrastructure, $400 million -- will be used to help build important local infrastructure projects such as roads, bridges, sewers and water systems.

• Clean Ohio Conservation, $200 million -- will fund the preservation of farmland and greenspace.

• Clean Ohio Revitalization, $200 million --will help revitalize our cities and industrial areas by brownfield clean up and transformation into new residential and business development.

• Historic Preservation Tax Credit, $120 million -- will revitalize historically significant buildings that expand the tax base of the local community.

Workforce:

• Higher Education Workforce Initiative, $250 million -- aims to keep more college-educated Ohioans in the state by linking them with good internships, cooperative education programs and jobs while they earn their degrees. Matched with private sector investments, this will make Ohio a leader in higher education and job creation efforts.

Gearhardt Testifies on Line Fence Legislation - Sponsor testimony was given last week by Rep. Bob Gibbs, R-Lakesville, in the Senate Agriculture Committee on HB 323. Also, testifying as a proponent was Larry Gearhardt, senior director of local affairs, Ohio Farm Bureau Federation. The bill makes changes to Ohio's 103-year-old line fence law. Throughout the hearings, Ohio Farm Bureau has played a key role in the drafting of the bill, which is expected to be voted out of committee and receive a floor vote this week.

 

Under this bill, a landowner who wants to construct a fence where none existed will be responsible for the cost of building and maintaining the fence. However, if a neighbor should use the fence to maintain livestock within 30 years, that landowner must reimburse 50 percent of the cost of building and maintaining said fence. The bill also creates a cost sharing mechanism for neighbors, allows neighbors to agree that no fence is needed, prohibits the removal of a fence without notification and establishes liability for damages caused by trespassing livestock. The bill also defines a "preferred partition fence," which is the type of fence the law could mandate when owners disagree.

 

CONTACT:

Niki Clum

Director of Constituent Action

nclum@ofbf.org