LITTLE ROCK — Arkansas farmers enter this holiday with a sense of uneasiness as Congress struggles in efforts to reach agreement on a new farm bill.
“It’s the not knowing,” said Matt Miles, whose family owns a 6,000-acre farm in Desha County.
Miles said it’s important for a farm bill to be in place soon so he and thousands of other farmers across the state can begin planning for next year, which includes getting production loans from the bank.
“It’s like if you don’t have all your tools,” he said. “You don’t have all the information to obtain a production loan and everybody has to have a production loan. Right now, no one knows what to expect.”
U.S. Sen. John Boozman, R-Ark., and U.S. Rep. Rick Crawford, R-Jonesboro, are members of a House-Senate conference committee charged with hammering out an agreement by Dec. 13.
Agriculture is the the largest industry in Arkansas and accounts for about one-fourth — $16 billion — of the state’s economic activity. One out of six jobs in the state are agri-related, according to Arkansas Farm Bureau.
For generations, the federal farm bill has set long-term national policy for farm subsidies, food stamps and other rural development projects. Congress last approved a farm bill in 2008 and was scheduled to reauthorize it a year ago. Instead, lawmakers approved a one-year extension of the $500 billion legislation. The extension expired last month.
Agriculture advocates and educators in Arkansas want the next farm bill to be for at last a year, and they want the traditional combination of farm subsidies and food assistance programs.
The House stripped nutrition program from the version it passed, to be considered separately.
“I think it’s a mistake,” said Arkansas Agriculture Secretary Butch Calhoun. “I’m not going to say they don’t need to do something on the nutrition side, the SNAP (Supplemental Nutrition Assistance Program), but it’s a mistake to completely separate them.”
Combining the elements “has worked for years and years and years. That gets people to come together from the big cities and from all congressional districts and all the states … and support a farm bill,” Calhoun said.
Without a new bill, or an extension of the 2008 bill, the country’s farm policy would revert to the 1949 law which, among other things, gives the U.S. secretary of agriculture the power to set price controls and production limits for farmers.
“If no new legislation is passed, then the default legislation would be the 1949 farm bill with budget-busting levels of support, something that neither taxpayers nor consumers would tolerate,” said Eric Wailes, who holds the L.C. Carter Chair for Agricultural Economics and Agribusiness for the University of Arkansas System Division of Agriculture.
“I expect that they’re going to get to it. Whether or not it’s going to be a short-term extension, another one-year extension, or actually get something done remains to be seen,” Wailes said.
Rich Hillman, vice president of the Arkansas Farm Bureau and a farmer of soybeans and rice in Carlisle, said Congress must approve at least a one-year extension. Anything less would hurt the state’s largest industry, he said.
“Anything other than a full extension is certainly going to leave agriculture, and particularly Arkansas agriculture, in a very, very … unstable manner,” Hillman said.
He said the state Farm Bureau opposes the separation of the nutrition programs and farm policies and has voiced its concern to U.S. Rep. Tom Cotton, R-Dardanelle, the only member of the Arkansas House delegation who voted against an early version of the House farm bill.
Cotton voted for a later version from which funding for nutrition programs was removed.
“I think he understands where we stand,” Hillman said.
Keeping the two together is important because that means the bill gets bipartisan support from both rural representatives as well as those who represent urban areas, he said.
“Agriculture is not as important in some states as it is in others,” Hillman said, noting that Los Angeles County in California has 17 U.S. House members, compared to four for all of Arkansas.
Those California members of Congress care a great deal about nutrition assistance programs but “could care less about the agriculture situation in Arkansas,” he noted.
Like Miles, Hillman said farmers annually seek production loans from their local bankers and the uncertainty of a long-term farm bill makes it more difficult for bankers to offer the loans.
Along with seed, farmers also must purchase equipment and other items to keep their farms running from year to year.
“So to make those expenditures, to make those financial plans, to be efficient, we need a long-term farm bill,” he said.
Calhoun said there is a sense of urgency among many farmers for Congress to get its act together.
“What they need to do is get busy and pass a farm bill,” he said. They need to pass one because it’s time for people to start borrowing money. It’s time for people to start finalizing their plans about what they are going to plant next year.”
One thing that will be different, said Miles, Hillman and Calhoun, is that direct government payments to farmers will probably be eliminated in a new farm bill.
Hillman said neither the House version or Senate version of farm bills contain that subsidy, and that is a concern.
“As far as Arkansas farmers are concerned, that’s a lot of the safety net we have currently,” he said.
Ending direct payments is the primary source of savings in the Senate bill, which would reduce overall spending on agriculture programs by $13.9 billion over a decade, according national reports. The House bill would cut spending on agriculture programs by $12.9 billion over 10 years.
Without the direct payments, the safety net would be maintained, in both bills, with beefed up crop insurance that farmers pay into and provide some additional protections.
Miles and Hillman said Arkansas farmers prefer the direct payments because they don’t often file for crop insurance.
“In our area with the irrigation the way it’s set up, insurance has never been something that has worked on us,” he said, adding the direct payments improves cash flow for the farmers at the beginning of the season.
U.S. Agriculture Secretary Tom Vilsack said during in a speech in October that he opposes separation of the farm bill and is optimistic that Congress will come to an agreement before the Dec. 13 deadline.
“There are benefits that will accrue that serve the producers,” he said in describing the importance of a farm bill. “The safety net will be put in place and people will be free to invest.”