Farm Progress is part of the Informa Markets Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Serving: IA

Budget cuts will affect farm programs

U.S. Secretary of Agriculture Sonny Perdue speaking at ag summit
SAFETY NET: “We want a stable financial safety net for farmers,” U.S. Secretary of Agriculture Sonny Perdue said at the Iowa Ag Summit. “But we don’t want Congress interfering with the market. We want farmers producing for the market, not the farm program.”
Legal Issues: Proposed cuts in USDA funding come as farmers are facing their fourth straight year of falling income.

Proposals for the new farm bill are getting attention. The Trump administration is calling for major budget cuts at USDA, including farm programs.

In a time when Iowa farmers are worrying about low farm income and severe drought issues across the state, they are concerned lawmakers will make big cuts to programs, such as crop insurance, that will further impact their bottom line. Many landowners are also worried conservation program funding and cost-share programs are on the chopping block.

Discussion of the farm bill was the focus last month at the Second Iowa Ag Summit, organized by Bruce Rastetter, CEO of Summit Group. The event brings together farmers, state and federal officials and representatives of the ag industry.

Perdue at the podium
USDA Secretary Sonny Perdue was the keynote speaker, along with Iowa Gov. Kim Reynolds and U.S. Sens. Chuck Grassley and Joni Ernst, both Republicans from Iowa, among others. Topics covered water quality, conservation and renegotiation of NAFTA. In his remarks, Grassley said, “The farm bill is the pre-eminent piece of legislation for rural America. I know of no other piece of legislation that impacts such a large area of our country.”

Grassley is hopeful Congress can pass a farm bill before the Christmas holiday. He also said there will be no new funding, so we can expect that existing and proposed new programs will have access to the same pot of money.

Some attendees said cuts in the farm bill will have little to no impact on the overall federal budget, because the farm bill represents only about 2%. Others, such as Wendy Wintersteen, dean of Iowa State University’s College of Ag and Life Sciences, urged Congress to invest more money in ag research to help the U.S. prepare for the next crisis in our food system, which we cannot predict.

Perdue’s visit to Iowa was part of a larger tour across the Midwest, labeled the “Back to Our Roots” RV tour. Perdue said, “We want a stable safety net for producers. While we recognize we don’t want Congress interfering with the market, we want producers producing for the market and not the program.” He told farmers they can no longer talk among themselves and must engage in public policy at both the state and federal level and remind those in Congress what farmers do and what they need from USDA.

Date of next farm bill
The House Ag Committee went on the road the first week of August to engage in listening sessions, as lawmakers prepare to write the next farm bill. It appears farmers can expect a new farm bill, as Grassley hopes, before year-end or early in 2018.

Obviously, the future of the farm bill is tied up in fiscal year 2018 budget negotiations and tax reform — another top priority of legislators. However, recommendations and the work of preparing the new farm bill are underway.

The American Farm Bureau Federation sent its plan to the House and Senate ag committees, proposing to overhaul commodity programs by allowing farmers enrolled in USDA’s Agriculture Risk Coverage (ARC) program to choose between calculating yields on a simple 10-year average or five-year Olympic average (the five-year Olympic average is the only choice now).

AFBF also proposes raising ARC reference prices by 5% for crops such as corn, soybeans, wheat, sorghum and minor crops. Also being discussed among other items are changes to the Margin Protection Program for dairy producers.

It does appear that legislators have a good understanding of what ag producers are dealing with across the country and recognize that all of ag is struggling with low prices along with damaging droughts across the High Plains.

In a July Senate Ag Committee hearing relating to crop insurance and risk management, Sen. Pat Roberts, R-Kan., said, “Given the current state of the farm economy and credit challenges facing producers, especially young and beginning farmers, it is essential we also examine the [Farm Service Agency] direct and guaranteed loan programs to determine if improvements can be made. As we review the risk management and credit programs and consider changes, the reality is we face budget constraints and limited resources for the farm bill.”

Some provisions may see changes
There is criticism regarding the Conser-vation Reserve Program, as mentioned by Ernst at the Iowa Ag Summit, in that Conservation Reserve Program payments have become too lucrative or excessive in states like Iowa, which, it is argued, deincentivizes farmers from producing a crop in a time of low farm incomes.

Some groups have proposed a new program that would allow for short-term CRP contracts. So far, AFBF has not proposed increasing the cap on CRP or creating the possibility for shorter-term contracts.

So the talk continues. At the Iowa Ag Summit, Perdue focused on the development of new and beginning farmers, and announced a mentoring program for these farmers.

As always, contacting your legislator to voice concerns relating to the farm bill is advisable. As the secretary suggested, those of us in the ag community cannot talk to ourselves; we have to be vocal about the future of farming in our state and to farmers’ needs for a new farm bill. Stay tuned.

Herbold-Swalwell is an attorney with Brick-Gentry PC in Des Moines. Contact her at [email protected].

Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.