Bill Huffman
Director - Government Relations

The Friday Report

July 10, 2009

Congress returned to session this week fully focused on health care and climate control legislation. It appears that most of the effort on health care reform is occurring in the Senate where Senator Max Baucus, D-Montana, is the lead negotiator. Baucus is in a slow deliberate mode to build consensus on health care reform. It appears that pharmaceutical companies and hospitals have expressed support and offered proposals and it remains to be seen if the physicians will step forward. Meanwhile, lobbyists for health insurance companies, AARP, other health organizations, labor unions and consumer groups are walking the halls of Congress offering their views for an against the Obama Administration’s proposals to reform health care in America. Momentum, at the moment, appears to favor a major health care reform bill this fall.

As for climate control legislation, Senator Barbara Boxer, D-Ca, Chair of the Senate Environment and Public Works Committee announced Thursday that she will push back mark up of the Senate climate control legislation to September, after the traditional Congressional August recess. Mrs. Boxer earlier had pledged to mark up a Senate bill by the August break, however, it appears there is a major divide in the Senate over climate control legislation and cap and trade carbon provisions. It is clear the House Bill will not be acceptable to many, if not most, in the Senate. This legislation has a long ways to go before a vote on the Senate floor.

Finally, the Senate Appropriations Committee Wednesday approved its FY 2010 spending bill for the U.S. Dept. of Agriculture and the Food and Drug Administration. The bill would appropriate $100.8 billion for mandatory programs and $23.6 billion in discretionary spending, both increases over the current fiscal year. The full House also approved the agriculture and FDA budgets during the week. Key programs of interest to the rice industry, the Market Access Program and Foreign Market Development Program were funded at the same level as the current fiscal year.

Senate Seats Franken

Newly elected Senator Al Franken, D-Minn, was seated Tuesday. That brings the Democrats to 58 members in the Senate with two independents who caucus with the Democrats (Lieberman and Sanders) for a potential 60 members, enough to shut off filibuster debate should that be necessary. But this doesn’t mean the Democrats can always count on all 60 to pass legislation!

As we’ve reported before, Senators Ted Kennedy and Robert Byrd have not been in the chambers for several weeks due to personal health issues. They would certainly be called upon should that be necessary, especially on the health care reform legislation. It remains to be seen if Moderate Republican Senators Olympia Snowe and Susan Collins of Maine will cross the political isle and vote with Democrats on health care, climate change and other broad sweeping legislation proposed by the Democrats.

ACRE Program Update

The 2008 Farm Bill included a new program called the ACRE Program (Average Crop Revenue Program) that was lobbied by the National Corn Growers Association, American Farmland Trust and sponsored by Senator Tom Harkin, Chairman of the Senate Agriculture Committee. In a report this week, Jim Miller, Undersecretary for Farm and Foreign Agricultural Services said that only 946 farmers out of 1.3 million who participate in Agriculture Department commodity programs signed up for the ACRE program. Hum!

Miller said “it is unclear whether farmers have not signed up for the ACRE program because they don’t like it or whether they don’t understand it.”

The National Corn Growers Association said June 24th that the Bush Administration’s decision to leave implementation of the ACRE program up to the Obama Administration had slowed the program’s implementation.

Our view is that farmers understand the program quite well and chose not to enroll in it! Remember, the money supposedly saved by the ACRE program was to be used to fund more nutrition programs.

As you may recall, farmers participating in the ACRE program would receive payments based on a rolling market season average price and state crop yields rather than the current target price program. But to participate, farmers would have had to give up 20 percent of their direct payments and see a 30 percent reduction in their market loan rate and the payments would not be made to them until several months after the crop was harvested and sold. The formula for determining “rolling market season average prices and state crop yields” made many growers distrusting of USDA’s ability to administer (fairly) this program!

USDA Administrator Resigns

The Administrator for the USDA Farm Service Agency, Doug Caruso, resigned this week. He simply said “the job was not what I expected. While I believe USDA leaders and I share the same goals, we clearly have divergent views on how to accomplish those goals.” Caruso was appointed to the post on May 4th. He formerly was CEO of Wisconsin Farmers Union Specialty Cheese Co., and earlier served as State Executive Director of FSA in Wisconsin.

Late yesterday, Agriculture Secretary Tom Vilsack named Jonathan Coppess as Administrator for the Farm Service Agency. Coppess previously served as a legislative assistant for agriculture, energy and environmental policy for Senate Ben Nelson. He holds a law degree.