Farm Progress

Massive spending bill offers fix for Section 199A, emissions reporting, trucking rule and SAM/DUNS requirements.

Jacqui Fatka, Policy editor

March 30, 2018

4 Min Read

Omnibus is a Latin word meaning “for all,” and the massive, $1.3 trillion omnibus spending bill Congress passed ahead of the Easter recess includes nearly all of the things agricultural groups have been seeking from Congress in recent months.

Here’s a rundown of the most important ag riders that found their way into the final bill.

'Grain glitch': One of the most economically sensitive issues for the countryside was the Section 199A “grain glitch” created in the tax reform bill. The omnibus bill includes a Section 199A fix that will equalize the tax treatment of commodity sales to cooperatives and non-cooperatives while also providing a flow-through deduction from co-ops to their members similar to the old Section 199 deduction for domestic production activities.

The National Grain & Feed Assn. and National Council of Farmer Cooperatives agreed on the compromise, which was developed after months of collaboration and extensive analysis.

Under Section 199A currently, producers can deduct up to 20% of gross payments received on sales to agricultural cooperatives without certain limitations based on income, while farmers selling to private/independent companies have been restricted to deducting 20% of net business income — a considerably smaller deduction.

Related:Tax bill impacts how you’ll market grain

Just days before the vote, smaller grain facilities were considering closing their doors or filing paperwork to become a cooperative. The legislative provisions amend this to help restore the marketplace balance.

CERCLA reporting: With a court order set to impose a massive reporting deadline on farmers May 1, the omnibus bill includes a permanent on-farm exemption for reporting air emissions from manure under the Comprehensive Environmental Response, Compensation & Liability Act (CERCLA).

In 2008, the U.S. Environmental Protection Agency exempted most farms from reporting the release of manure-related ammonia and hydrogen sulfide under both CERCLA and the Emergency Planning & Community Right-to-Know Act, deeming such reports unnecessary. However, in April 2017, the District of Columbia Court of Appeals directed the removal of this exemption for dairy and other livestock operations under the two federal laws.

The omnibus bill includes the Senate's Fair Agricultural Reporting Method Act that would restore the farm exemption for reporting emissions from manure.

Ag trucking rule delay: The bill includes a provision that would grant livestock haulers an exemption from the ELD rules until Sept. 30, 2018. This extra six-month delay will give the Federal Motor Carrier Safety Administration (FMCSA) more time to educate livestock haulers on ELDs while the industry works on a solution to the current hours-of-service rules, which are difficult to adhere to for those hauling live animals across the country.

A U.S. Department of Transportation rule issued in 2015 required truckers of commercial vehicles involved in interstate commerce to replace their paper driving logs with ELDs by Dec. 18, 2017. In September 2017, agricultural groups petitioned the agency for a waiver and exemption from the requirement, and DOT provided livestock haulers with an initial 90-day waiver — until March 18 — from the mandate.

ELDs — which can cost $200-1,000 plus a $30-50 monthly fee — record driving time, engine hours, vehicle movement and speed, miles driven and location information and electronically report the data to federal and state inspectors. ELDs supposedly help DOT enforce its hours-of-service rule, which limits commercial truckers to 11 hours of driving time and 14 consecutive hours of on-duty time in any 24-hour period. Once drivers reach that limit, they must pull over and wait 10 hours before driving again.

SAM/DUNS requirements: The bill permanently eliminates System for Award Management (SAM) and Data Universal Numbering System (DUNS) requirements to participate in conservation programs. Under current law, farmers must obtain SAM registration and DUNS numbers before applying for conservation programs.

Agriculture Secretary Sonny Perdue praised the exemption, stating that it "clears away red tape for participants in conservation programs" and that SAM and DUNS "were designed for billion-dollar government contractors, not everyday farmers trying to support their families."

Other notables: The bill extends the current Pesticide Registration Improvement Act through Sept. 30, 2018. The Senate Agriculture Committee held a hearing and passed a three-year reauthorization of the law.

This the first time in a decade that funding for farm bill conservation programs has been left intact in an appropriations bill.

Farm Service Agency direct farm ownership and operating loans received $3 billion, which should be sufficient to meet the anticipated increase in farmer demand. Congress also restricted any additional agency office closures.


About the Author(s)

Jacqui Fatka

Policy editor, Farm Futures

Jacqui Fatka grew up on a diversified livestock and grain farm in southwest Iowa and graduated from Iowa State University with a bachelor’s degree in journalism and mass communications, with a minor in agriculture education, in 2003. She’s been writing for agricultural audiences ever since. In college, she interned with Wallaces Farmer and cultivated her love of ag policy during an internship with the Iowa Pork Producers Association, working in Sen. Chuck Grassley’s Capitol Hill press office. In 2003, she started full time for Farm Progress companies’ state and regional publications as the e-content editor, and became Farm Futures’ policy editor in 2004. A few years later, she began covering grain and biofuels markets for the weekly newspaper Feedstuffs. As the current policy editor for Farm Progress, she covers the ongoing developments in ag policy, trade, regulations and court rulings. Fatka also serves as the interim executive secretary-treasurer for the North American Agricultural Journalists. She lives on a small acreage in central Ohio with her husband and three children.

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