Senate passes $286 billion farm bill

Staff and Wire reports

WASHINGTON — The Senate on Friday approved a $286 billion farm bill with an election-year expansion of subsidies for growers and food stamps for the poor.

The bill, passed on a 79-14 vote, expands subsidies for wheat, barley, oat, soybeans and several other crops and creates new grants for vegetable and fruit growers.

It also increases loan rates for sugar producers, extends dairy programs and provides more dollars for renewable energy and conservation programs to protect environmentally sensitive farmland over the next five years.

Sen. Pete Domenici, R-N.M., voted in favor of the bill, which will restore a peanut storage and handling payment program that is important to New Mexico farmers.

Domenici commended the Senate bill’s inclusion of measures that will benefit New Mexico’s peanut and specialty crop industries, but criticized another aspect of the bill.

“The dairy provisions remain, I believe, unfair to our growing dairy industry,” he said.

The bill will now be referred to a conference committee to reconcile differences in House and Senate-passed versions of the bill.

President Bush has threatened to veto the legislation, saying it costs too much and should instead be cutting subsidies at a time of record-high crop prices. He also has threatened to veto a House version passed in July.

Unlike the Senate, the House did not approve the bill by a veto-proof majority, or two-thirds of the chamber. That vote was 231-191.

While the House and Senate bills are similar, significant differences will have to be worked out after Congress reconvenes in January.

One of them is the creation of new $5 billion fund for weather-related agricultural disasters in the Senate version that was added by Senate Finance Committee Chairman Max Baucus, a Montana Democrat who is up for re-election next year.

Both bills attempt to limit subsidies somewhat. The Senate legislation would eventually ban payments to “nonfarmers” whose income averages more than $750,000 a year. The bill defines farmers as those who earn more than two-thirds of their income from agriculture. There would be no new income-based limits on what a farmer could collect, though the bill would ban some farmers from collecting payments for multiple farm businesses.

The House would ban payments to all who earn an average $1 million a year or more, and also bans some farmers from collecting payments for multiple businesses.

A Bush administration proposal goes much further, suggesting a reduction of payments to individuals who make more than an average of $200,000 yearly. The current cap is $2.5 million.

Acting Agriculture Secretary Charles Conner issued a statement after the vote calling the legislation “fundamentally flawed.”

Many farm programs have been operating under a temporary extension since the last five-year farm law expired Sept. 30. The chairmen of the House and Senate agriculture committees said earlier this week that they will push to further extend the law until March to ensure that funding for the bill remains consistent.