Farm Bill amendment adds mandatory funding for farm energy programs

By Agri-Pulse staff

© Copyright Agri-Pulse Communications, Inc.



Washington, April 26, 2012 - A bipartisan amendment that would add some $800 million in mandatory funding to farm bill energy title programs was adopted by the Senate Agriculture Committee Thursday.

 

The amendment was one of several offered during a committee mark-up of a 2012 Farm Bill proposal. The bill is expected to go to the Senate floor within the next few weeks, said Sen. Debbie Stabenow, D-Mich., who chairs the committee.

 

Sens. Kent Conrad, D-N.D., and Richard Lugar, R-Ind., drafted the amendment, with another nine senators from both sides of the aisle signing on to the provision, which advocates say would encourage advanced biofuels production, as well as promote other renewable energy and energy efficiency projects in rural America.

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A committee version of the 2012 Farm Bill proposal, which was released late last week by committee Chair Stabenow, D-Mich., would reauthorize a number of farm energy programs that originated with, or were restructured by, the 2008 Farm Bill. The 2012 proposal from Stabenow provided discretionary funding for all programs reauthorized, but no mandatory funding.

 

However, farm energy advocacy groups feared that without mandatory spending, little to no money will be authorized for programs they say have helped revitalize rural America, allow new agricultural markets emerge and reduce the need for direct payments to farmers. The programs, which have no authorization beyond the end of the current farm bill Sept. 30, are zeroed out under Congressional Budget Office baseline estimates.

 

The Conrad-Lugar amendment would set mandatory funding totaling $241 million over five years for REAP and $193 million for BCAP. Another $216 million would be required over the life of the new farm bill for the Biorefinery Assistance Program, $130 million for the Biomass Research and Development Program, while $15 million would be allotted for the Biobased Markets Program, and $5 million for a Biodiesel Education Program.

 

The authors had originally proposed the mandatory spending be offset by removing funding for the Economic Adjustment Assistance to Users of Upland Cotton program and by reducing the premium for Catastrophic Risk Protection.

 

But an amendment from Sen. Saxby Chambliss, R-GA., removing the offsets was adopted by the committee after CBO estimated this morning that total deficit reduction offered by the farm bill proposal would come in at $24.7 billion, an increase over the $23 billion projected last fall by congressional budget analysts.

 

The “committee print” of the farm bill offered originally by Stabenow would have reauthorized two high profile farm energy programs, the Rural Energy for America Program (REAP), and the Biomass Crop Assistance Program (BCAP), both at discretionary funding levels of $20 million per year.

 

REAP, which had $22 million in mandatory funds set aside for this fiscal year ($25.4 million total), offers grants and loan guarantee for farm and rural business renewable energy and energy efficiency projects. BCAP, which had new funding capped at $17 million this year, offers grants and loan guarantees to encourage feedstock production for nearby bioenergy facilities. The BCAP language in the proposal precludes any overlap of program money and payment received under the Conservation Reserve Program.

 

Other programs authorized in the committee print include the Bioenergy Program for Advanced Biofuels at $20 million per year ($65 million authorized for this fiscal year), and the Biobased Markets Program and the Community Wood Energy Program, both at $2 million per year.

 

To emphasize a focus on bioenergy by-products, another section of the 2008 Farm Bill, the Biorefinery Assistance Program, would be renamed the Biorefinery, Renewable Chemical and Biobased Product Manufacturing Assistance and be allocated $150 million annually in discretionary funding. No new funding was authorized for the program for fiscal 2012.

 

The Biomass Research and Development program would get an annual allotment of $30 million (compared with $40 million this fiscal year), and the Secretary of Agriculture would be required to commission a study of the economic impact of the biobased products industry.

 

The Repowering Assistance Program, which was designed to convert oil burning ethanol plants to gas or biofuel energy, would be repealed, as would the Forest Biomass for Energy Program.

 

The Conrad-Lugar amendment also carries language from a Lugar legislative proposal last year that would authorizes discretionary funding under another title of the farm bill for a Rural Energy Savings Program. The initiative would allow rural electric cooperatives to provide customers with low-interest loans for energy efficiency upgrades, to be paid back on monthly electric bills. The provision has no mandatory funding.

 

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