A group of farm-state senators led by Agriculture Committee Chairman Tom Harkin is asking Agriculture Secretary Ed Schafer to stop trying to re-write the Food, Conservation and Energy Act of 2008 through the regulations implementing the new farm bill.
The senators – Harkin, D-Iowa, Richard Durbin, D-Ill., and Sherrod Brown, D-Ohio – have written Schafer asking him to not use lower commodity prices than are specified in the bill to set the revenue guarantee benchmarks for the new Average Crop Revenue Election or ACRE program.
ACRE, a new revenue-based counter-cyclical payment program conceived by the Iowa Corn Growers Association, was included in the new farm law after being introduced by Durbin and Brown. Harkin and other lawmakers have accused USDA of trying to re-write the farm bill in other areas as well.
“We are puzzled why the Department would undermine this promising new revenue protection in the implementation process when the administration’s own farm bill proposal called for a revenue protection program,” the letter said. “We are extremely concerned that the Department seems intent on unilaterally making up a version of ACRE contradictory to what was clearly enacted in the farm bill’s statutory provisions.”
The senators asked Schafer to implement the ACRE program in a timely basis and to follow the Congressional intent and statutory language by using 2007 and 2008 prices to determine the guarantees for the 2009 crop year.
Press reports have suggested USDA may set the 2009 revenue guarantees using market prices for the 2006 and 2007 crop years. “This is despite clear language in the statute establishing the ACRE program guarantee price for a crop year as the simple average of the national average market price received by producers of the covered commodity or peanuts for the most recent 2 crop years,” the senators said.
“The crop year is the year the crop is harvested, so for the 2009 crop year, the most recent 2 crop years are 2007 and 2008. We are extremely concerned that the Department seems intent on unilaterally making up a version of ACRE contradictory to what was clearly enacted in the farm bill’s statutory provisions.”
Other groups of senators have complained about USDA’s rulings that farmers cannot reconstitute their farming operations to include farms of less than 10 acres. Under the new law, USDA will no longer make commodity program payments to farms that small.
In establishing the guarantee prices for the 2009 ACRE program, the senators said, USDA must use the simple average of national prices for the 2007 and 2008 crops.
“We recognize that the final prices for the 2008 crop year will not be available at the time the Department provides notice to producers of the opportunity to elect to participate in ACRE,” they said. “This will in no way jeopardize implementation of the program.
“USDA may want to calculate estimated revenue guarantees prior to producer signup, but this is not essential to program implementation. Our expectation is that for the 2009 crop year, USDA would announce program signup no later than early spring 2009.”
The senators said they interpret the new law to mean USDA would calculate and announce state revenue guarantees for each covered commodity and peanuts once all the relevant price and yield data are available.
The announcements using national average prices for 2007 and 2008 crop years and state-level yields for 2004, 2005, 2006, 2007 and 2008 crops would be available for all covered commodities and peanuts no later than October 2009. Payments would be calculated at the end of the 2009 marketing year for each covered commodity and would be paid beginning Oct. 1.