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Letter to Ed Schafer, Secretary of the Department of Agriculture, Re: Ensure a True Crop Safety Net

Letter

By:
Date:
Location: Washington, DC


Letter to Ed Schafer, Secretary of the Department of Agriculture, Re: Ensure a True Crop Safety Net

Senator Clinton Calls on Bush Administration to Ensure a True Crop Safety Net

Urges USDA to Respect Subsidies for Small Farms

Senator Hillary Rodham Clinton today joined a bipartisan coalition of lawmakers in calling on the Bush Administration to implement the 2008 Farm Bill according to the law's intent and abandon an interpretation that would disadvantage small farms across New York and around the country. In a letter to U.S. Department of Agriculture (USDA) Secretary Ed Schafer, Senator Clinton and her colleagues rejected the USDA's interpretation of a provision of the Farm Bill that prohibits direct payments, counter-cyclical payments, or average crop revenue election payments if the sum of the base acres of a farm is 10 acres or less. The Senators noted that this interpretation runs contrary to clear statutory language and urged the USDA to implement the regulation according to the law's intent.

"The Farm Bill takes steps to ensure that small farms receive the support and resources they need, but the Bush Administration is ignoring the letter of the law and undermining the safety net that protects our farmers. I urge the USDA to apply the provisions of the Farm Bill fairly and correctly, and live up to the commitments we have made to farmers and growers," said Senator Clinton.

A USDA policy notice published in June states that the Farm Service Agency County Committees (COC) will not allow the consolidation of farms having base acreage of 10 acres or less, making such farms ineligible for subsidies. However, the statutory language clearly intends for such consolidations to be legitimate for determining eligibility for subsidies.

The text of the Senators' letter follows.

August 12, 2008

The Honorable Ed Schafer
Secretary
U.S. Department of Agriculture
1400 Independence Ave, SW
Washington, DC 20250


Dear Secretary Schafer,

The Food, Conservation, and Energy Act of 2008 (P.L. 110-246, June 18, 2008) includes a new provision regarding the treatment of farms with limited base acres. Section 1101(d)(1) prohibits direct payments, counter-cyclical payments, or average crop revenue election payments if the sum of the base acres of the farm is 10 acres or less. Section 1101(d)(2) provides exceptions for socially disadvantaged or limited resource farmers or ranchers.

On June 30 the Commodity Credit Corporation of the U.S. Department of Agriculture (USDA) published a notice in the Federal Register entitled, "2008 Direct and Counter-Cyclical Program." A section of this Notice provides:

"Effective with the date of publication of this notice, to be assured that producers on farms with base acres of 10 acres or less are prohibited from receiving payments as provided in the 2008 Farm Bill, Farm Service Agency County Committees (COC) will not approve requests for farm combination reconstitutions of farms having base acres of 10 acres or less if the request was received after the date of enactment of the 2008 Farm Bill (May 22, 2008). However, as an exception to the above rule, a farm with a total of 10 base acres or less may combine with another farm if one of the farms undergoes a change in land ownership. To qualify for this exception the owners of each of the farms participating in the new combination must be identical and have identical shares in both farms." 73 FR 36840

The policy set forth in this notice disregards the statutory language which applies the limitation to the "sum of the base acres of the farm." This intent is clearly stated in the statement of Managers which provides:

"The Managers intend for the Department to allow for the aggregation of farms for purposes of determining the suspension of payments on farms with 10 base acres or less. The Managers expect for the Department to review farms in this category on an annual basis rather than prohibiting payments to these farms for the life of the farm bill." House Report 110-627, May 13, 2008, page 675.

We are concerned by recent conversations with USDA personnel that they are relying (at least in part) on draft language considered during the conference process. Regardless of previous draft language that was considered by the conference committee, the intent of this provision was to prohibit payments only if the sum of all base acres on the farm is 10 acres or less. The conference committee intended to allow reconstitutions or aggregation of farms in determining eligibility. Draft language reviewed by the conference committee is not relevant to program implementation. Only the actual text of the bill passed by Congress and the managers' language should be considered by USDA during rulemaking and implementation of the Act.

The statement of managers provides that aggregation of acres was intended. Thus, a farm with 10 or fewer base acres may be aggregated or combined with any farm or farms with an amount of base acres (whether owned or rented) so the total aggregated base acres on the resulting farm exceed 10 acres, making the resulting farm eligible for direct, counter-cyclical, and average crop revenue election payments.

The notice language that provides that a farm with a total of 10 base acres or less may combine with another farm only if one of the farms undergoes a change in land ownership, and that to qualify for this exception the owners of each of the farms participating in the new combination must be identical and have identical shares in both farms is an arbitrary and restrictive rule imposed by USDA which runs counter to the intent of the managers and Congress for implementation of Sec. 1101(d)(1) of the Act.

We expect that the Department will defer to areas of clear congressional intent and implement the law in such a manner.

Sincerely,


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