Ag policy horizon looks bleak

Ag policy horizon looks bleak

Election year may stall movement on significant agenda items while regulatory proposals remain in crosshairs.

AGRICULTURE has seen some major legislative wins over the last six months, but some very pressing regulatory actions also still pose a significant concern to the agriculture industry.

The farm bill and the waterway bill were two of the first major authorization bills that made it through Congress in the new budget-constrained, politically polarized legislative environment, Brad Lubben, a policy specialist at the University of Nebraska-Lincoln, explained. "It shows that something can still get done, even against all kinds of debate."

The farm bill remains one of the major headlines, especially while all of its rules are being written and program signups get underway.

Lubben said the Farm Service Agency has been making "tremendous strides in terms of rolling out disaster assistance programs very quickly." By the end of the summer, the agriculture industry is likely to be heavy into the educational — and maybe even the signup — process.

The U.S. Department of Agriculture has allocated $6 million to that educational process. USDA has chosen the University of Missouri's Food & Agricultural Policy Research Institute (FAPRI) to help develop those tools.

FAPRI director Pat Westhoff said the organization is meeting with USDA to discuss expectations for the tools. The end goal is to put together a web-based tool farmers can use to evaluate various signups, and the Texas A&M University Agricultural & Food Policy Center is already working on some computer programming for the tools, Westhoff added.

From a legislative standpoint, Congress is about done for the year, explained Mary Kay Thatcher, senior director of congressional relations at the American Farm Bureau Federation.

Tax extenders. Thatcher said Congress could try to pass some sort of tax extenders bill, but it's going to be hard.

She said she believes "life got more complicated on that front" when former Senate Finance Committee chairman Max Baucus (D., Mont.) took a post as the U.S. ambassador to China in February. In addition, House Ways & Means Committee chairman Dave Camp (R., Mich.) is not seeking re-election.

The full House approved a bill making a Section 179 tax credit permanent that allows farmers, ranchers and other small businesses to write off up to $500,000 a year on equipment purchases.

The Senate Finance Committee took similar action this spring but extended the tax break for only two years as part of a broad bill extending 55 separate tax breaks, including those for biofuels. The bill later stalled on the Senate floor when Republicans were not allowed to introduce amendments. The House Ways & Means Committee took the list of 55 and broke it down into several individual bills.

CFTC. The House approved its reauthorization package for the Commodity Futures Trading Commission (CFTC), and despite Senate Agriculture Committee chair Debbie Stabenow (D., Mich.) noting that the two chambers share ideas on some parts of the bill and differ on others, it is unlikely that Senate Democrats will have the appetite to take up a bill this year.

For agriculture, the CFTC bill provides assurance that the futures markets are protected and also offers a solution for what the industry has called a "very troubling" residual interest rule — which CFTC approved last fall — that would force customers to pre-margin hedge accounts.

Highway Trust Fund (HTF). One issue that needs to be resolved this summer is funding the HTF, which is projected to run out of cash by August.

Steve Kopperud, executive vice president of Policy Directions, said it's expected that an extension will be tacked onto any short-term funding solution. Unlike in the past, the two-year budget agreement President Barack Obama signed last year doesn't allow Congress to shift money from general treasury funds to keep the HTF running.

A bankrupt HTF means states that currently receive about $45 billion in federal contributions to highway, bridge, urban commuter and related projects would begin to shut down ongoing projects, idling thousands of workers nationally.

EPA. Lubben said the agriculture industry needs to carefully watch the rule-making process on regulatory requirements, particularly from the Environmental Protection Agency. Pressing issues include the waters of the U.S. rule, Clean Air Act and final levels for the renewable fuel standard (RFS).

Nearly 35 Republican senators joined together to propose the Protecting Water & Property Rights Act of 2014, which prevents EPA and the Army Corps of Engineers from finalizing their proposed rule defining waters of the U.S.

Thatcher doesn't expect the legislation to go anywhere this year, but members will continue to drum up support. Although no Democrats have signed onto the bill, Thatcher said once one or two do, many others likely will follow suit.

Some House members had pushed to include a similar rider in the appropriations bill, but since spending bills likely will get lumped together, the rider is unlikely to survive that process, she noted.

Thatcher projected that EPA will make some kind of notification on RFS levels within the next month. The levels were first proposed last fall, and EPA has received hundreds of thousands of comments on the RFS proposal.

Westhoff said he expects at least some increase in RFS levels versus the proposed rule. This will also give an indication of how necessary EPA finds it to pay attention to agricultural stakeholders' comments on other rules, such as the water rule, he added.

Volume:86 Issue:26

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