NCGA's Public Policy Action Team has worked on an alternative to today's farm support programs for well over a year.

The NCGA proposal is designed to be more market oriented, but also more effective in protecting farm crop revenue against production losses, depressed prices and rising input costs.

Despite improvements in the 2002 Farm Bill, many farmers have experienced firsthand the holes in the current farm safety net.

Isolated areas can be hit with low yields during a period of low prices. The result is low deficiency payments and crop insurance fall well short of offsetting the income losses.

Countercyclical payments and Loan Deficiency Payments fill part of the revenue gap in a low price market, but farmers with short crops during a year of high yields and high prices nationwide can't look to countercyclical payments or LDPs for relief.

An obvious indicator that we have a hole in our current federal farm safety net is that ad hoc disaster assistance between 2000 and 2005 has averaged $1.8 billion a year.

NCGA has developed two revenue-based programs to replace loan deficiency payments and countercyclical program.

The first, Base Revenue Protection, or BRP, guarantees a producer 70% of his net crop revenue-based on his five Olympic average.

Rather than using a price trigger, the Revenue Countercyclical Program establishes a guarantee of a crop's target county revenue-based on the national season average price and a trend yield (over 20 years of production history). Farmers receive payments when the actual county revenue falls below the target revenue level.

To eliminate duplicate coverage of the BRP, the RCCP maximum payment is 30% of the county target revenue.

NCGA's plan also calls for maintaining decoupled direct payments, along with developing new crop insurance products and a new recourse marketing loan.

Looking toward the future, the economic analysis indicates this revenue-based plan would provide a more "relevant" safety net given the major changes in our commodity markets.