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Bi-partisan House deal pushes Farm Bill forward
By Sara Wyant , Agri-Pulse Communications, Inc.
With just 9 days to go before the current farm bill expires, House leaders finalized a deal
yesterday to forge ahead with a scaled back spending framework that is $5.5 billion over baseline
and includes more substantial cuts in crop insurance, but does not include a permanent disaster
provision or a controversial tax package. However, it’s not clear whether this newest proposal
will win support from Senate colleagues or even a majority of the House conferees, once more
details become available.
Rep. Bob Goodlatte (R-VA), who serves as the ranking Republican on the House Agriculture Committee said the new proposal is bi-partisan and supported by House Speaker Nancy Pelosi (D-CA) and House Republican Leader John Boehner (R-OH).
“It’s a good approach,” Goodlatte said. “The problem that we had, in addition to how to pay for the bill, is what is outside of our (the Agriculture committees’) jurisdiction. It has complicated, for many months, the effort to get something done.”
He said the package they’ve outlined does not look like the one he and Chairman Collin Peterson (D-MN) put forward in February that was about $6 billion over the baseline, but offered few specifics, other than to emphasize that the farm bill would not be paid for with new taxes.
Shortly after Speaker Pelosi named House farm bill conferees yesterday, Goodlatte offered a motion on the House Floor to instruct conferees not to agree to any provisions that increase taxes in a final farm bill agreement. The non-binding motion passed by a 400-11 margin.
Sources say that one of the main offsets to pay for additional farm bill spending comes from a proposal that’s opposed by major business and banking groups: requiring credit card issuers to report all business transactions to the Internal Revenue Service (IRS). The proposal aims to make sure that all business income is reported. President Bush supported this offset in his federal budget proposal, but in the past, administration sources say it was rejected for use in farm bill funding scenarios.
Chairman Peterson is also apparently planning on generating $6.5 billion in savings from crop insurance, which is $500 more than the House originally offered to cut and $600 more than the most budget framework that was previously agreed to (based on spending $10 billion over the baseline).
According to sources who have seen portions of the plan, Peterson’s latest proposal includes two components that would cut more from the Administrative and Operating (A&O) payments made for policies in states with low loss ratios and higher rates of premium growth and take less from the A & O payments made in states with high loss ratios and lower rates of premium growth. Reimbursement rates would not be cut in states with loss ratios greater than 1.00. (For more background on this issue, see the 4-9-08 issue of Agri-Pulse.)
Key differences remain
In an attempt to iron out long-standing differences on funding issues, key Democrats met last night for over an hour in Speaker Nancy Pelosi’s office last night. Participants included Pelosi, Majority Leader Harry Reid (D-NV), Senate Finance Committee Chairman Max Baucus (DMT), House Ways and Means Committee Chairman Charles Rangel (D-NY), House Agriculture Committee Chairman Collin Peterson, Senate Agriculture Committee Chairman Tom Harkin (DIA) and several staff members.
Rather than face a small group of reporters assembled outside Pelosi’s front hallway, all but Rangel left the meeting through other doors. Asked whether or not an agreement had been reached on the tax provisions, Rangel said “No…We kind of thought that we were prepared to do our part, if only we knew what our part would be paying for…”
“We are going to conference to iron out the differences between the House bill and the Senate bill,” he added.
Rep. Jerry Moran (R-KS), who was named as a farm bill conferee, was walking near Pelosi’s office last night and offered to shed some light on the overall strategy.
“We’re trying to move a portion of the farm bill, the historic portion, in a way that lends itself to getting something done,” Moran explained, rather than getting bogged down in funding issues controlled by other committees.
“The plan is to provide a proposal to the Senate that leaves the issue of the tax provisions and permanent disaster for determination by Ways and Means and Finance,” he explained. “If that’s not agreed to, then the only alternative I know is….it seems to me that we’re back to an extension, which I don’t know how you can pass. It’s the proverbial….rock and a hard spot.”
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