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Farm Bill Passes; Bush Veto Coming; Override Possible

In very strong bipartisan votes, the House of Representatives and the Senate passed the “Food, Conservation and Energy Act of 2008.” The House vote was 318

In very strong bipartisan votes, the House of Representatives and the Senate passed the “Food, Conservation and Energy Act of 2008.” The House vote was 318-106 and the Senate vote was 81-15; a majority of both Democrats and Republicans supported the bill in both chambers. Some of the highlights of the $289-billion, five-year bill are:

  • Mandatory country-of-origin labeling (COOL) – Mandatory COOL for meat, chicken, fruits and vegetables will go into effect.
  • Interstate shipment of state-inspected meat – The legislation provides for the interstate shipment of state-inspected meat. This has been advocated by many state departments of ag for decades.
  • Packers and Stockyards Violations Report – USDA shall submit an annual report by the Grain Inspection, Packers and Stockyards Administration (GIPSA) that will detail the number of investigations into possible violations of the Packers and Stockyards act. The report will detail the length of time that investigations are pending with GIPSA, USDA’s General Counsel and the Justice Department.
  • Crop Revenue Election Program (ACRE) – Producers will have the option, beginning with the 2009 crop year, to participate in a state-level revenue protection system.
  • Rebalances target prices and loan rates – The bill adjusts loan rates and target prices of existing commodities beginning with the 2010 crop year.
  • AGI eligibility test – To receive farm-program benefits, an individual’s non-farm income may not exceed $500,000. If farm income exceeds $750,000, an individual will no longer be eligible to receive direct payments.
  • Disaster assistance – Establishes a permanent disaster assistance program.
  • Environmental Quality Incentives Program (EQIP) – Provides an additional $3.4 billion for the EQIP.
  • Conservation Stewardship Program (CSP), formerly the Conservation Security Program – CSP is focused on incentivizing new conservation, while simultaneously rewarding producers for achieving high levels of stewardship and addressing priority resource concerns in their area. The program will enroll nearly 115 million acres by 2017.
  • The Foreign Market Development Program and the Market Access Program - Continue funding at $34.5 million and $200 million, respectively.
  • Biomass loan guarantees – The bill provides $320 million in funding for loan guarantees for commercial scale biorefineries for advanced biofuels. This program is to help commercialize cellulosic ethanol.
  • Ethanol credit modification – The 51¢/gal. credit for ethanol is reduced by 6¢ in the year after which the 7.5-billion-gal. threshold established in the 2005 Energy Policy Act is reached.
  • Cellulosic biofuels – A new temporary production tax credit for up to $1.01/gal. is established for cellulosic biofuels.
  • Nutrition – Provides additional funding for food stamps, food banks and nutrition programs.
The bill now goes to President George W. Bush, who plans to veto it. “Deeply disappointed” in the farm bill conference report, Bush said it falls short of the administration’s farm bill proposal. USDA Secretary Ed Schafer called on members of Congress on both sides of the aisle to support Bush’s stand “for fiscal discipline and the best interests of America's farmers and ranchers."

A showdown is likely next week. A two-thirds majority of both the House and the Senate is needed to override the Bush veto. But with the large number of votes in support of the bill this week, supporters believe an override is very possible.