Senate Democrats have altered the upcoming farm bill debate with this week’s stunning agreement on a budget reconciliation bill. The bill earmarks about $20 billion for farm bill conservation programs and provides about $20 billion more for energy and forestry programs under the control of the Agriculture Committee.
The funding would address some of the pressure that’s on Congress to help farmers and landowners meet U.S. goals for reducing greenhouse gas emissions.
“This investment in the future is needed to help America’s farmers, ranchers and growers explore and adopt innovative approaches to production to help address the challenge of climate change,” said Chuck Conner, president and CEO of the National Council of Farmer Cooperatives.
But, but, but: The top Republican on the Senate Agriculture Committee, John Boozman, tells Agri-Pulse the funding sets a bad precedent for farm bill programs. It’s not the first time the budget process has been used to provide additional funding for a farm bill. But this week’s agreement earmarks the funding for specific programs, and Boozman says that’s a bad idea.
“I think it's going to make it much more difficult to write farm bills in the future, because if we're not careful, farm bills will be written through reconciliation,” he said.
He went on, “This $40 billion is going to be spent with no input from the stakeholders, no input from Republicans (and) very little input from most Democrats,” he said.
Keep in mind: Senate Ag Chairwoman Debbie Stabenow, D-Mich., has said Republicans had no input because they didn’t intend to support the bill anyway.
Bill’s winners include biofuels industry, electric co-ops
The bill creates a new tax credit for low-carbon biofuels and provides another $500 million for biofuel infrastructure.
Rural electric co-ops scored $9.7 billion for projects that could reduce carbon emissions and increase resilience. They also got a long-sought provision that allows them to benefit directly from renewable energy tax credits.
Take note: The new clean fuels tax credit would end after 2027, so companies have no assurance of permanency.
Cover crop payments go MIA
Notably missing from the new climate package is a plan to pay farmers $25 an acre for planting cover crops. That program was in the House-passed Build Back Better bill but didn’t make the cut for the Senate agreement.
But Reps. Cindy Axne, D-Iowa, and Sean Casten, D-Ill., are proposing a program to provide $5-an-acre payments for cover crops as subsidies for crop insurance subsidies. The proposal mirrors some state initiatives as well as a program the Biden administration has offered the past two years.
The bill’s supporters include the Illinois Farm Bureau, the Natural Resources Defense Council, American Farmland Trust, and the National Wildlife Federation.
Keep in mind: The conservation funding in the reconciliation deal would help pay for cover crops, too.
Big day on Hill for bills
There’s nothing like a looming August recess to spur action in Congress. On Thursday, the House provided final congressional approval of the CHIPS bill that will pour money into domestic semiconductor manufacturing, a priority for equipment manufacturers.
The Senate, meanwhile, passed its version of a water projects reauthorization bill. The Senate’s Water Resources Development Act would increase the federal Treasury cost share for inland waterways projects from 65% to 75%.
That would be a significant win for ag shippers because it would make funding from the Inland Waterways Trust Fund go farther. IWTF is funded from barge taxes. The House-passed WRDA wouldn’t change the cost share.
McKalip vows to fight for US dairy access to Canada
Doug McKalip, the nominee to be the next chief U.S. agriculture negotiator, promised senators Thursday he will try to make Canada live up to its dairy market access promises under USMCA.
The U.S. in May lodged a second complaint that Canada has continued to block its retailers and food service operators from buying U.S. cheese and other products under quota allocations.The U.S. won its first USMCA dispute against Canada, but the Biden administration says Canada’s response was inadequate.
“This is not something we will let rest,” McKalip told the Senate Finance Committee. “Canada’s response to that decision fell far short of the mark.”
USDA builds on broadband ‘backbone’
USDA’s undersecretary for rural development, Xochitl Torres Small, says the department’s experience with the ReConnect broadband funding program will allow it to hit the ground running with money provided by the bipartisan infrastructure law. Most of the infrastructure bill’s broadband funding is being routed through state agencies, but USDA controls about $2 billion.
“We’re able to start and continue expanding on that backbone,” Torres Small says in an interview for this week’s Agri-PulseNewsmakers.
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By the way: The Senate Appropriations Committee released a fiscal 2023 spending bill for USDA that includes another $400 million for ReConnect.
This week’s Newsmakers will be available today at Agri-Pulse.com.
Competition grows for climate-smart grants
The total amount of funding sought by applicants to USDA’s $1 billion Partnerships for Climate-Smart Commodities program has now topped $20 billion.
In the second round of applications, reserved for smaller-scale projects, the Natural Resources Conservation Service received more than 400 requests totaling $2 billion. NRCS received applications for more than $18 billion in the first round of applications for grants of more than $5 million.
Applicants in the second round, which is for grants of $250,000 to $5 million, are offering matching funds totaling $1.3 billion.
What’s next: The funding is expected to be awarded by fall.
She said it. “For the U.S. to meet its climate goals, we must quickly expand the volume of low-carbon biofuels available across the entire transportation sector – on the ground, in the air, and at sea.” - Growth Energy CEO Emily Skor on the reconciliation bill.