Friday, February 07, 2014

The 2014 Farm Bill: The Good, the Bad and the Ugly

AliciaIt's official! After years of setbacks and political gridlock, President Obama just signed the 2014 Farm Bill, a 959-page behemoth, called the Agricultural Act of 2014, into law.

If you’re tired of hearing about the Farm Bill, we can hardly blame you. Initial Farm Bill negotiations started back in 2010 and it has taken Congress an inexcusable length of time to get something passed. Needless to say, our family farmers and ranchers (and we eaters!) have waited far too long for several critical programs to receive renewed funding.

We’re fatigued, to say the least, and not the least bit impressed with the atrocious, back-door deal made between just four lawmakers, which unraveled unprecedented reforms to commodity programs. That said, several of the most innovative programs in federal farm policy ever were protected in this bill—some even received more funding than we anticipated.

We get into the details of what’s in the $100 billion-a-year bill below, but as a final note, we'll state that lawmakers have once again dodged implementing deep, structural reforms to our food and farm system.

What does that mean? It means this farm bill fails to secure a fair price for farmers that both covers their cost of production and provides a living wage. It does nothing to control overproduction of key commodities and somehow, under the guise of the “free market,” corporate power and moneyed agribusiness firms gets to proceed unfettered while our farmers grapple in markets so volatile they could give you whiplash. (That’s a rigged market in our opinion, not a free one, but we’ll save that for another blog post…) It means we’ve slashed conservation programs at a time when farmers need everything we can possibly put together to address climate change and rebuild our soil and water resources. It means that our federal government will look the other way as our farmers face corporate abuse and market concentration, instead of using their full authority to do something about it.

The bottom line is—-it’s not enough. This bill won’t steer our agricultural sector towards the true resiliency and diversity it needs for this generation and generations to come. It takes important steps in that direction, but we still have important battles ahead.

Despite the fatigue, we’re not too tired to keep up the good fight and we have to say we're proud. We're proud of all of YOU who helped fight for the dozens of amazing programs that we've won and who helped ward off nasty corporate lobbying efforts. Whether you joined us at our Action Center, were one of thousands of individuals who signed petitions at the Farm Aid concert the past few years, or are more generally an engaged farmer or eater who is using the power of your voice, we say thanks!

We’ll keep you posted on how to join us in bringing real change to food and agriculture. In the meantime, here are some highlights from the bill:

Beginning, Veteran & Socially Disadvantaged Farmers

Several measures in the Farm Bill will help create new opportunities for the next generation of farmers and ranchers. In total, the new farm bill will invest $444 million directly into beginning, veteran, and socially disadvantaged farmer initiatives over the next ten years, an increase of 154 percent over the previous farm bill.

Farmer Training: The Beginning Farmer and Rancher Development Program, which was stalled since it ran out of funding in late 2012, will see an influx of $100 million for new farmer training programs, plus a new focus on rehabilitation and vocational training for veteran farmers. The program maintains its priority on training geared for socially disadvantaged beginning farmers.

Military Veteran Farmers: The new farm bill will also create a new position, The Military Veteran Agricultural Liaison, at USDA to help returning military veterans pursue careers in agriculture and access USDA programs.

Socially Disadvantaged Farmers and Ranchers: The new farm bill essentially halves funding for the Outreach and Assistance for Socially Disadvantaged Farmers and Ranchers program (also known as Section 2501). In place since the 1990s, this program has helped countless underserved farmers, including farmers of color and tribal farmers, access federal programs. The bill will provide only $10 million per year, while expanding the program to serve returning military veterans pursuing careers in farming. This underinvestment shortchanges our nation’s most vulnerable and chronically underserved farmers.

Land Access: The new bill will improve the Down Payment Loan Program, which provides capital to new farmers seeking to purchase property, by increasing the total value of farmland allowed from $500,000 to $667,000. The bill creates a new Agricultural Conservation Easement Program to protect the agricultural use of conserved farmland and ensure it’s accessible and affordable to new farmers. Finally, it increases funding for the Conservation Reserve Program – Transitions Incentives Program (CRP-TIP), which incentivizes retiring landowners to rent or sell their farmland to beginning, socially disadvantaged and military veteran farmers.

Credit Access: The new farm bill will prioritize lending to beginning and socially disadvantaged farmers through the Farm Service Agency’s Direct and Guaranteed Farm Ownership and Operating loan programs. It will also lower the interest rate for Joint Financing loans that bring together farmers, USDA, and a private lender to leverage scarce federal credit dollars. The bill also makes the new FSA Microloan program permanent and establishes an intermediary lending pilot program so non-profit community lenders can provide microloans and financial training to small, beginning, veteran and socially disadvantaged farmers. Additionally, microloans made to beginning and veteran farmers will be exempt from the term limits that otherwise apply on direct operating loans. The bill will also give beginning farmers (in their first five years of production) a reduction on crop insurance premiums.

Conservation Programs: The new farm bill will continue conservation incentives for beginning and socially disadvantaged farmers that were established in the 2002 and 2008 Farm Bills. The bill also retains set-asides for beginning and socially disadvantaged farmers in EQIP and the Conservation Stewardship Program. The bill also expands these conservation incentives to include veteran farmers.

Commodity Payments & Crop Insurance

The federal safety net for farmers has taken on quite a few models through the decades. The last several years have shown a growing role of crop insurance subsidies in the overall farm safety net regime.

Safety Net: In place of the direct payments, which were costing $4.5 billion annually—Congress is now giving farmers of major row crops like corn, soybeans, wheat and rice a choice between subsidies that pay out when revenue drops or when prices drop. If that doesn’t sound all that different than what we currently do, that’s because in the end it isn’t. Those programs may kick in sooner than expected as some crop prices have started to drop in recent months. What’s more, they fail to address the underlying problems that create volatility in commodity markets.

Expanded Crop Insurance: On a high note, the final bill directs USDA to develop a new nationwide Whole Farm Diversified Risk Management Insurance product to provide revenue insurance for highly diversified farms of all kinds, including specialty crop farms, integrated grain-livestock farms, organic farms, and farms geared to local markets. These farms have largely been left out of the federal crop insurance system to date.

Food Stamps & Food Security

A major target during the farm bill debate was the Supplemental Nutrition Assistance Program (SNAP), formerly known as the food stamps. The final bill cut over $8 billion from the program over 10 years, an $880 million cut each year that translates to a monthly loss of $90 for each of the 850,000 households participating in the program. Several lawmakers who voted against the bill were livid over this, particularly at a time when more Americans are hurting and the economic gap between our richest and poorest is widening. According to Feeding America, 76 percent of SNAP households include a child, an elderly person, or a disabled person. These vulnerable households receive 83% of all SNAP benefits.

Community Food Projects: The bill also nearly doubled funding for Community Food Projects and creates a new Food Insecurity Nutrition Incentive grant program to encourage fruit and vegetables consumption by SNAP recipients.

CSAs for SNAP: Several provisions ease the purchase of fresh and local produce for SNAP recipients by allowing them to use their benefits to participate in Community Supported Agriculture (CSAs) ventures, and by equipping farmers markets and other direct-to-consumer marketing outlets to accept SNAP benefits. The bill also includes pilot projects for improving technologies used in purchases made with EBT.

Farmers Markets and Local Food

The Farm Bill has finally started to get interesting for those of us interested in renewing rural economics and rebuilding local and regional food systems. The overall big picture is that USDA will now have over $1.2 billion to invest over the coming five years in a range of the most innovative and transformational programs within the farm bill.

Local and Regional Food Systems: The farm bill increased funding for several programs and created some new programs in this space.The bill triples funding to $30 million per year for the Farmers Market and Local Food Promotion Program, and expands the program to allow grants to both direct-to-consumer projects and projects supporting local and regional food enterprises through processing, aggregation, distribution, storage, and marketing.

Farm to School: The bill authorizes an eight-state pilot to provide fresh fruits and vegetables to schools and allow a geographic preference in procurement.

Rural Job Creation: The farm bill is the major legislation for rural economic and community development. Rural development did not fare well, but it did fund two important programs. The Value-Added Producer Grant program will receive approximately $12.5 million annually to help farmers develop new markets for high quality products that are farm identity-preserved. The Rural Microentrepreneur Assistance Program will have $3 million a year to provide training, technical assistance, and microloans to very small rural businesses.

Research Dollars: A highlight from the Research Title is the infusion of $600 million in mandatory research dollars to support specialty crops, organic agriculture, and beginning farmers. These programs have all been stranded without funding since 2012, and have underpinned the growth of these sectors over the past decade. The specialty crop research program received permanent funding – a huge win!

Conservation

On the bad news end of the equation, conservation programs, the largest pot of money our government devotes to protecting our natural resources, took a big hit. In fact, the conservation cuts represent the first time Congress slashed conservation spending since the first conservation programs were created in the 1985 farm bill. In every farm bill since then – 1990, 1996, 2002, and 2008 – the investment in conservation has increased.

The big cuts were to the Conservation Reserve Program (CRP) – the largest conservation program and major land retirement program – and the Conservation Stewardship Program (CSP) – the largest working lands program. The CRP will be cut over the coming years to 24 million acres total. The CSP will be cut to 10 million new acres per year, reducing the program by 28 million acres.

Congress also chose to consolidate several conservation programs in this farm bill, including all existing easement programs into a single overarching umbrella program with permanent funding (which is good!). These easement programs will see a net increase over the next 10 years of $1.2 billion.

In a small bright spot, conservation compliance (a requirement that farmers receiving federal commodity or crop insurance payments adhere to conservation programs) was protected in this farm bill.

However, cuts to conservation programs will continue under Congress’ current sequestration scheme, and will likely endure additional cuts in the appropriations process. In short, this farm bill simply will not equip our nation’s farmers and ranchers with the resources they need to conserve and stewards our soil, water and air—of critical importance in an era of climate change.

Organic Agriculture

Organic agriculture fared well in this farm bill. The National Organic Certification Cost-Share Program is now funded at $11.5 million annually to offset the costs of annual certification for organic farmers and handlers. It renews funding for the Organic Agriculture Research and Extension Initiative at $20 million per year, and for the Organic Production and Market Data Initiatives at $5 million over five years, the same as in the previous farm bill. The National Organic Program also receives $5 million for technology upgrades.

The bill also improves crop insurance for organic producers by requiring USDA to publish the complete set of organic price elections by 2015. The bill also includes a provision to exempt organic producers from having to pay into conventional checkoffs, and to allow the organic sector as a whole to establish a checkoff program if so desired.

Market Fairness & Corporate Abuse

A bright spot in this farm bill is the success of advocates to preserve Country of Origin Labeling (COOL) and enforcement of fair competition rules for poultry and hog producers and fair contracts for livestock and poultry producers. This is a significant victory, although the fight will continue during annual appropriations, where it is almost certain that multinational meatpacking companies will try to cut these measures once again.

Industrial hemp

For the first time, the farm bill will authorize colleges and universities to grow industrial hemp for research purposes in states that permit its growth and cultivation (currently nine states — Colorado, California, Kentucky, Maine, Montana, North Dakota, Oregon, Vermont and West Virginia).

Want to know more?

  • Check in with our partners at the National Sustainable Agriculture Coalition for a 7-part series breaking down the 2014 Farm Bill. It’s good reading for the farm policy nerds among us!
  • HOMEGROWN.org farmer-blogger Bryce Oates gives his take on the Farm Bill here.
  • What is the Farm Bill anyway? Check out our Farm Bill 101 here.

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