Ag Policy Blog

More details came out today regarding some specific provisions in the farm-bill extension language that was part of the tax bill approved earlier this week by Congress. The bill extends most farm programs through Sept. 30, 2013, giving lawmakers nine months to get a new bill moved.

FYI, and I want to credit Chuck Abbott at Reuters for digging out this gem: No farm bill has ever started during one term of Congress and had to be reintroduced in a subsequent term of Congress to be completed.

Much of the challenge from the extension comes from a problem highlighted in the 2008 farm bill. There were 37 programs in that legislation that didn't have a "budget baseline" to carry forward after Sept. 30, 2012.

Commodities:

The legislation extends current commodity programs for the 2013 crop year, including direct payments. The provisions postpone any issues with milk or other commodities falling under the 1949 permanent law.

Disaster:

Disaster programs were authorized in the bill, but not with any mandatory funding. The one exception is the Supplemental Revenue Assistance Program, or SURE, which was not reauthorized. Instead, discretionary levels were set with funding for certain programs that could come through the appropriations process. Those programs include:

$80 million for livestock indemnity payments

$400 million for the livestock forage assistance program

$50 million for emergency assistance for livestock, honeybees and fish farmers.

$20 million for the tree assistance program

Conservation:

Conservation Reserve Program is maintained at the same level of 32 million acres. Programs such as the Grassland Reserve Program and Wetlands Reserve Program are not reauthorized.

Energy:

A laundry list of energy programs were extended without mandatory funding, meaning any funding for these programs would have to come through the appropriations process. The Biomass Crop Assistance program is authorized for $20 million in discretionary spending for 2013. Most of the other programs are reauthorized at previous spending levels.

Research, horticulture and beginning farmer and rancher programs also were authorized with discretionary funding:

Beginning Farmer and Rancher Development Program was authorized for $30 million in 2013

Organic Ag Research and Extension, $25 million

Specialty Crop Research Initiative, $100 million

Farmers Market Promotion Program, $10 million

National Organic Certification Cost-Share, $22 million

Outreach and Technical Assistance for Socially Disadvantaged Farmers and Ranchers, $20 million

Some terminated programs include:

Local and regional food-aid procurement

The McGovern-Dole International Food program

Market loss assistance for asparagus producers

Value-added market development grants

In other tax credits important to people in agriculture, the legislation extended:

The Production Tax Credit for wind for projects starting in 2013

Cellulosic Biofuel Producer Tax Credit

Biodiesel Tax Credit

Also, bonus depreciation was set at 50% for property put into service in 2013.

Section 179: The deduction for both 2012 and 2013 was set at $500,000, with phaseout beginning when investments reach $2 million.

(Thank you to the National Farmers Union for producing a primer detailing the farm-bill programs and tax provisions in the legislation. The details were more timely and far better than what I have received from official Congressional sources at the moment)

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