What is in this article?:
- White House’s proposed fiscal year 2013 budget would slash USDA spending 3 percent.
- 2011 farm incomes are projected at a near-record $22 billion.
- Direct payments likely to eliminated.
Insurance, conservation, energy
Under Obama’s budget, crop insurance will also receive funds as well as the 2011 SURE payments. The White House “will encourage Congress to extend disaster payments and programs in some form or fashion in the (next) farm bill,” said Vilsack. “It’s relatively the same proposal as in previous years. It looks at catastrophic coverage, it looks at ANO caps, and reasonable and appropriate returns for companies.”
As for conservation, the proposed budget “will support 360 million acres. CRP (Conservation Reserve Program) would be capped at 30 million acres. … An additional 29 million acres (would be funded) under the EQIP, CSP and other programs.”
Queried on the next farm bill and the current divisive dynamics in Congress, Vilsack said “Everyone knows we need a farm bill.” Groups around the country “from virtually aspect of the farm bill” recently expressed in a letter to Congress a desire for a new farm bill in 2012. “The reason is simple. There is a strong desire to have certainty, an understanding of what the rules will be. Given the fact that we’re seeing good, solid (farm) income, we don’t want to do anything … to upset the momentum.”
Meanwhile, leadership in the agriculture committees, “have stepped up and have a desire to get things done. … They have scheduled hearings and begun the process.”
Vilsack expressed a desire to work with Congress on a new revenue guarantee proposal. Is that reflected in the proposed budget?
“It’s reflected in the sense that, in the budget where (Obama suggests) direct payments be removed, (he) also talks about the need for a continuation of disaster. I believe it’s somewhere in the neighborhood of $8 billon to $9 billion allocated for that purpose. Obviously, we see some adjustment. … Again, the budget is looking at a 10 year horizon.”
According to Vilsack, fiscal constraints the USDA faces involve three pots of money: farm payments, conservation, and nutrition assistance.
“There’s a general consensus that the direct payment system is going to change. It will change because fiscal realities will necessitate it. It will change because it’s very hard to explain to the 98 percent of the population that doesn’t farm why farmers are receiving payments when we’re seeing record, or near-record, income levels…
“We continue to need a safety net. So, we’ll work with Congress to reshape that safety net to provide the help and assistance that farmers need, when they need it. That will probably involve continued commitment to crop insurance as well as some kind of revenue protection program that will help folks when they’re really hurting.”
What about energy programs?
“Congress has basically limited (funds) available to us” for the Biomass Crop Assistance Program (BCAP). “Congress must decide if they wish to reauthorize (energy) programs within the context of the 2012 farm bill. Unfortunately, few of them were funded for the length of the 2008 farm bill so they aren’t in the baseline. That creates a set of challenges.”
There was a 96 percent reduction in BCAP funding over the last year. “We’ll try to figure out how to use those limited resources – I think it’s $17 million – as effectively as possible. There are two responsibilities of BCAP: identify project areas that encourage non-food feedstocks to be produced; and the collection/storage/transportation expenses for producers.”