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Under Secretary Dorr outlines administration's farm bill proposalBy Doug Rich Under Secretary of Rural Development Thomas Dorr, stopped in Kansas at the Kansas Farm Bureau Headquarters Feb. 8 to discuss the administration's 2007 farm bill proposals. 
"This is the first time in 30 years that an administration has put forward a well thought out farm bill," Dorr said. Many of the proposals are based on information gathered from 52 farm bill listening sessions held in 48 states last year. Dorr said they collected 4,000 comments and compiled 41 summary papers. As debate on the next farm bill begins the question has been whether to extend the 2002 farm bill or to rewrite that legislation. "This administration has no inclination to extend the 2002 farm bill although it was the right policy at the time," Dorr said. Dorr noted that commodity prices are very strong at this time; exports have increased every year since 2002 to a record $68.7 billion in 2006; debt to asset ratio is the lowest it has been in history at 11 percent in 2006; and renewable energy is a significant contributor to rural and agricultural economies. The administration's farm bill proposal would convert the current price-based countercyclical program to a revenue-based program that is responsive to actual conditions but still provides a strong safety net. "It changes the commodity title from price driven to revenue driven," Dorr said. The current price driven program tended to under-compensate farmers who had a crop loss and over compensate those with high production. The revenue program will factor in U.S. crop yield when determining crop payments to better target support. The proposal reduces the Adjusted Gross Income limit of $2.5 million to a new limit of $200,000. To receive commodity payments producers must meet the AGI limit which includes wages and other income minus farm expenses and depreciation. Under this proposal if a producer has an AGI of $200,000 or more he would not be eligible for commodity payments. The administration's farm bill proposal continues substantial support for renewable energy with $1.6 billion in funding. Particular emphasis is put on cellulosic ethanol projects. The 2002 farm bill was the first to include an energy title. Specifically the energy title proposed by this administration includes: --$500 million for a bioenergy and biobased product research initiative. --$500 million for renewable energy systems and efficiency improvements grants program. --$120 million to support an estimated $2.1 billion in loan guarantees for cellulosic ethanol projects in rural areas. The Conservation Reserve Program would be reauthorized under the proposed farm bill. It would give priority within whole field enrollments to lands used for biomass production. The harvest of a portion of the residue on CRP acres for biomass production would be allowed. The proposal contains additional help for beginning and socially disadvantaged farmers. Help for beginning farmers includes: --Increased limits for direct ownership loans and direct operating loans to a combined maximum of $500,000. --Double the percentage of direct operating loans targeted to beginning and socially disadvantaged producers to 70 percent. --Eliminate the $250,00 cap on the value of property that may be purchased. --Set aside 10 percent of all farm bill conservation program spending for beginning and socially disadvantaged farmers. Doug Rich can be reached by phone at 785-749-5304 or by e-mail at richhpj@aol.com. B 3 2/19/07 1 Star WK Date: 2/15/07
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