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Grassley and Dorgan’s new plan for farm bill

As all sides continue to jostle over a new farm bill, Sen. Charles Grassley of Iowa is an enthusiastic member of the scrum.

Last week, the Republican introduced a new plan hoping to break the current impasse. The plan, a four-point payment limitation proposal developed by the Center for Rural Affairs — a Nebraska-based think tank — could save up to $2 billion over a decade, claims Grassley.

“I plan on writing to (Senate Agriculture Committee) Chairman Tom Harkin and (USDA) Deputy Secretary Chuck Conner to encourage substantive conversations on payment limitations,” said Grassley in late March while traveling in his home state. “Farm bill negotiations have clearly pointed to the difficulty in finding acceptable financing mechanisms that meet the demands for farm bill funding as well as having substantial reforms.”

Grassley’s letter, co-signed by Sen. Byron Dorgan, N.D.-D, was sent March 26. In part, it reads:

Dear Chairman Harkin and Deputy Secretary Connor,

The purpose of this letter is to encourage a conversation between the two of you on the recently proposed four-point plan for payment limitations, both on its merits and in relation to the widely reported need to close a sizeable gap between funding levels and available offsets….

The four-point proposal … attempts to get us closer to a politically acceptable compromise by:

• Reducing payment limitations and income limitations only when prices are above target price, which should be acceptable to (House Agriculture Committee) Chairman Collin Peterson, who has been willing to sacrifice all payments in years of high commodity prices;

• Softening the impact of reduced limits on cotton, rice and peanuts in recognition of the differences between northern and southern agriculture;

• Incorporating the (Bush) administration proposal to lower Adjusted Gross Income limits, but with a feature to increase the savings by reducing payments on cash rented land owned by high income landlords; and

• Responding to the findings of the GAO (General Accounting Office) and USDA Payment Limitations Commission by incorporating the primary control and actively engaged in farming provisions of (an earlier Grassley/Dorgan proposal).

In recent days, farm bill negotiations have clearly pointed to the continuing difficulty in finding acceptable financing mechanisms that meet the demands for farm bill funding. We believe that a sizeable amount of the gap might be found in adopting the four-point program.

In response to our request, the Congressional Budget Office estimated preliminary savings of $1.186 billion over 10 years for the four-point program.

We understand that the Center for Rural Affairs recently presented Sen. Harkin with a revised version of the four-point program that they believe would be scored in the range of $2 billion.

The farm program, as it currently exists, too often directs payments in amounts that defy common sense or logic. Limiting farm program payments is good government on its own merits. At a time when there is an earnest search to find savings that will allow the farm bill to move forward, we urge the two of you to give careful consideration to (this proposal).

We thank you for your attention to this matter and look forward to hearing back from you concerning discussions on the subject.


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