Bill Huffman
Director - Government Relations

The Friday Report

June 5, 2009

Congress returned to session this week with a big agenda facing them. Health insurance, Cap & Trade legislation, and the nomination of the Supreme Court nominee dominate their agenda.

Cap & Trade Developments

Representative Frank Lucas, ranking member of the House Agriculture Committee this week sent a letter to USDA Secretary Tom Vilsack asking for clarification and specifics on how production agriculture can benefit from a cap-and-trade program as proposed in H.R. 2454, the bill recently approved by the House Energy and Commerce Committee.  Lucas joins Chairman Collin Peterson in challenging Secretary Vilsack for specifics related to agriculture.

In his letter, Mr. Lucas said, “You claim that you would push Congress to include an offset program for agriculture and forestry in the Waxman-Markey bill (H.R. 2454) and that USDA should administer the offset program.  However, you have failed to provide a plan with any of the details for how our agriculture producers can realize these so-called benefits.”

Lucas added, “Frankly Mr. Secretary, we in the agriculture community are waiting for you to substantiate your claims that agriculture only will benefit from a cap-and-trade program.  We are waiting for the details of your plan that will make farmers and ranchers net winners”.

Chairman Peterson and Congressman Lucas have said the Waxman-Markey bill does not recognize the role agriculture can play in providing carbon offsets and it does not provide a meaningful way for farmers to participate in carbon credit programs.  They are joined by over twenty-five major agriculture groups who have gone on record opposing the legislation because of the failure of the legislation to provide a meaningful program for agriculture.

Farm groups are pushing to create an agricultural offset program that is unlimited, recognizes “early actor” farmers and ranchers who have already implemented carbon-capture practices and ensures that any program with agriculture offsets be under the direction of USDA rather than the Environmental Protection Agency. The bill, as currently written, establishes as much as 2 billion tons of carbon offsets, but doesn’t have any provisions for farmland or forestry to play a role in those offsets.

It is interesting to note, as we reported before, that Agriculture Committee Chairman Collin Peterson threatened to derail the Waxman-Market bill saying that he had the votes to do so. After that threat, elements of the bill were referred to eight other House committees including the Agriculture Committee for consideration.  So far, it doesn’t appear that the Obama Administration and the Secretary of Agriculture have developed a plan for agriculture to be considered by the Agriculture Committee or the Congress as a whole.

It is also interesting to note that House Speaker Nancy Pelosi met Tuesday with the Chairman of the House Ways and Means Committee Chairman Charlie Rangel and House Agriculture Committee Chairman Collin Peterson to discuss the climate change legislation which she wants acted on by the end of this year. Afterwards, Chairman Peterson said “They seem like they want to work with us.  We’ll talk and we’ll see!”

It should be noted that the Waxman-Markey bill is slated to come to the House floor before July 4th, that’s just 30-days from now. 

Agriculture Appropriations

Key members of the Senate Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration and Related Agencies, told USDA Secretary Tom Vilsack this week that Obama Administration proposed cuts in spending for mandatory farm programs puts Congress “in a precarious situation”.  Subcommittee Chairman Herb Kohl, D-Wisconsin and rice state Senators Mark Pryor, D-Ark, and Thad Cochran, R-MS told Vilsack that cuts to mandatory farm programs are not appropriate, especially after Congress adopted the new Farm Bill just last year.

The Obama Administration wants to accrue savings in mandatory programs and shift that funding to Women, Infants and Children nutrition funding, address obesity and to manage the budget’s bottom line.

USDA Farm Service Agency County Committee Nominations

Agriculture Secretary Vilsack announced this week that farmer and rancher candidate nominations will begin June 15th for local Farm Service Agency county committees. The nomination period continues through August 3rd, with elections this fall. 

To be eligible to serve on a County FSA Committee a person must participate or cooperate in a program administered by FSA, be eligible to vote in a county committee election and reside in the local administrative area in which the person is a candidate.

To become a candidate, an eligible individual must sign a nomination form, FSA-669A.  The form is available online at: http://www.fsa.usda.gov/elections.  Nomination forms for the 2009 election must be postmarked or received in the local USDA Service Center by the close of business on August 3rd.

Proposed New Rules for Water Distribution

The National Marine Fisheries Service (NMFS) this week proposed new rules, in a biological opinion, that would further reduce diversions of water in the Sacramento-San Joaquin Delta for the San Joaquin Valley and Southern and Central California.  The new opinion was drafted by NMSF in response to a Federal court order by Judge Oliver Wanger of Fresno who found that an earlier biological opinion was insufficient and did not protect endangered species such as winter- and spring-run salmon, steelhead, green sturgeon and other species of fish that are protected by the Endangered Species Act.

In a wide ranging opinion, the NMFS proposal would reduce water diversions another 5-7 percent from the Delta, require the U.S. Bureau of Reclamation to restore fish populations above major dams on the Sacramento River and its tributaries, and require increased flows in the Sacramento and American rivers.

The proposed new rules would be the most far ranging single rulemaking action ever in the U.S. to restore fish access to spawning grounds above habitat-blocking dams such as Shasta Dam on the Sacramento River, the Nimbus and Folsom Dams on the American River, and the New Melones Dam on the Stanislaus River.

It is interesting to note that the rules do not specifically require fish ladders at each of the dams, but rather call for an interagency panel to research the best options and make recommendations by 2016 with a plan to be implemented not later than 2020.

This is a far reaching biological opinion. If approved and implemented, it could affect every irrigation diversion on the Sacramento River, has the potential to affect historic water rights, and certainly diminishes the supply of water for human purposes, agriculture and recreation.

The 800-page biological opinion was released Thursday by National Marine Fisheries Service. Among other recommendations, the opinion advocates increasing the amount of cold water stored at Shasta Dam, routing fish around the Red Bluff diversion dam, closing the “cross channel” gates in the Sacramento-San Joaquin Delta for longer periods as well as cutting diversions at the pumps near Tracy. The proposed cuts also impact urban areas that are served mainly by the State Water Project.

We understandthis new opinion will go back before Federal Judge Wanger, who continues to have jurisdiction over the issue because of his prior ruling on the initial NMFS opinion from 2004, which he rejected.

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