[House Report 110-881]
[From the U.S. Government Publishing Office]
110th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 110-881
======================================================================
TEMPORARY SUSPENSION OF CERTAIN LIMITATIONS ON ELIGIBILITY OF PRODUCERS
FOR DIRECT PAYMENTS, COUNTER-CYCLICAL PAYMENTS, OR AVERAGE CROP REVENUE
ELECTION PAYMENTS
_______
September 24, 2008.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Mr. Peterson of Minnesota, from the Committee on Agriculture, submitted
the following
R E P O R T
[To accompany H.R. 6849]
[Including cost estimate of the Congressional Budget Office]
The Committee on Agriculture, to whom was referred the bill
(H.R. 6849) to amend the commodity provisions of the Food,
Conservation, and Energy Act of 2008 to permit producers to
aggregate base acres and reconstitute farms to avoid the
prohibition on receiving direct payments, counter-cyclical
payments, or average crop revenue election payments when the
sum of the base acres of a farm is 10 acres or less, and for
other purposes, having considered the same, report favorably
thereon with an amendment and recommend that the bill as
amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. TEMPORARY SUSPENSION OF CERTAIN LIMITATIONS ON ELIGIBILITY
OF PRODUCERS FOR DIRECT PAYMENTS, COUNTER-CYCLICAL
PAYMENTS, OR AVERAGE CROP REVENUE ELECTION
PAYMENTS.
(a) Special Rule for 2008 and 2009 Crop Years.--Section 1101(d) of
the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8711(d)) is
amended by adding at the end the following new paragraph:
``(4) Suspension.--Paragraphs (1), (2), and (3) shall not
apply during the 2008 and 2009 crop years.''.
(b) Offsetting Reduction.--Section 515(k)(1) of the Federal Crop
Insurance Act (7 U.S.C. 1515(k)(1)) is amended by striking ``not more
than $15,000,000 for each of fiscal years 2008 through 2011'' and
inserting ``not more than $15,000,000 for fiscal year 2008, not more
than $9,000,000 for fiscal year 2009, and not more than $8,000,000 for
each of fiscal years 2010 and 2011''.
Brief Explanation
H.R. 6849 suspends, for the 2008 and 2009 crop years, the
provisions of the Food, Conservation, and Energy Act of 2008
that prohibit receipt of direct payments, counter-cyclical
payments, or average crop revenue election payments when the
sum of the base acres of a farm is 10 acres or less. Also
reduces by $20 million the funds available under section
515(k)(1) of the Federal Crop Insurance Act for Federal Crop
Insurance Corporation information management systems upgrades.
Purpose and Need
The Department of Agriculture published a notice stating
their intent to ``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''.
The Department's notice is a substantial change from what
was in place prior to the most recent Farm Bill and runs
contrary to what Congress intended when it drafted section
1101(d) of the farm bill.
Section-by-Section Analysis
Section 1(a) suspends, for the 2008 and 2009 crop years,
the farm bill provisions that prohibit receipt of direct
payments, counter-cyclical payments, or average crop revenue
election payments when the sum of the base acres of a farm is
10 acres or less.
Section 1(b) provides an offset of $20 million by reducing
funds available under section 515(k)(1) of the Federal Crop
Insurance Act for Federal Crop Insurance Corporation
information management systems upgrades.
Committee Consideration
The Committee on Agriculture met, pursuant to notice, with
a quorum present, on September 18, 2008, to consider H.R. 6849.
Members were recognized and each made a statement in
support of the legislation and Counsel was also recognized for
a brief explanation of the bill.
Chairman Peterson offered an amendment in the nature of a
substitute to the bill. Discussion occurred and without
objection, the amendment was adopted by a voice vote.
There being no more amendments, Mr. Goodlatte moved that
H.R. 6849 be reported favorably to the House with the
recommendation that it do pass.
By a voice vote, and in the presence of a quorum, H.R. 6849
was ordered favorably reported to the House.
Chairman Peterson then advised Members that pursuant to the
rules of the House of Representatives that Members have 2
calendar days to file such views with the Committee. No Members
came forth with intent to file additional views.
Without objection, staff was given permission to make any
necessary clerical, technical or conforming changes to reflect
the intent of the Committee.
Chairman Peterson thanked all the Members and adjourned the
meeting subject to the call of the chair.
Reporting the Bill--Rollcall Votes
In compliance with clause 3(b) of rule XIII of the House of
Representatives, H.R. 6849 was reported by voice vote with a
majority quorum present. There was no request for a recorded
vote.
Committee Oversight Findings
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the Committee on Agriculture's
oversight findings and recommendations are reflected in the
body of this report.
Budget Act Compliance (Sections 308, 402, and 423)
The provisions of clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives and section 308(a)(1) of the
Congressional Budget Act of 1974 (relating to estimates of new
budget authority, new spending authority, new credit authority,
or increased or decreased revenues or tax expenditures) are not
considered applicable. The estimate and comparison required to
be prepared by the Director of the Congressional Budget Office
under clause 3(c)(3) of rule XIII of the Rules of the House of
Representatives and sections 402 and 423 of the Congressional
Budget Act of 1974 submitted to the Committee prior to the
filing of this report are as follows:
U.S. Congress,
Congressional Budget Office,
Washington, DC, September 22, 2008.
Hon. Collin C. Peterson,
Chairman, Committee on Agriculture,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 6849, a bill to
amend the commodity provisions of the Food, Conservation, and
Energy Act of 2008 to permit producers to aggregate base acres
and reconstitute farms to avoid the prohibition on receiving
direct payments, counter-cyclical payments, or average crop
revenue election payments when the sum of the base acres of a
farm is 10 acres or less, and for other purposes.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Jim Langley.
Sincerely,
Robert A. Sunshine
(For Peter R. Orszag, Director).
Enclosure.
H.R. 6849--A bill to amend the commodity provisions of the Food,
Conservation, and Energy Act of 2008 to permit producers to
aggregate base acres and reconstitute farms to avoid the
prohibition on receiving direct payments, counter-cyclical
payments, or average crop revenue election payments when the
sum of the base acres of a farm is 10 acres or less, and for
other purposes
Summary: H.R. 6849 would suspend a prohibition on the U.S.
Department of Agriculture's (USDA's) authority to make payments
to certain farmers and ranchers for 2008 and 2009 crops. It
also would reduce funds appropriated to USDA, under the Food,
Energy, and Conservation Act of 2008 (the 2008 Farm Act), for
information technology equipment for the federal crop insurance
program.
CBO estimates that suspending the prohibition on payments
would increase direct spending for agricultural income
protection programs by $20 million over the 2009-2018 period.
We also estimate that reducing funds for information technology
would reduce spending by $20 million over the same period.
Thus, CBO estimates that enacting H.R. 6849 would have no
significant impact on direct spending over the 2009-2018
period. Enacting the bill would not affect revenues or
discretionary spending.
H.R. 6849 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would impose no costs on state, local, or tribal governments.
Estimated Cost to the Federal Government: For this
estimate, CBO assumes that H.R. 6849 will be enacted near the
start of 2009. The bill's estimated budgetary impact is shown
in the following table. The costs of this legislation fall
within budget function 350 (agriculture).
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------------------------------------------
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2009-2013 2009-2018
--------------------------------------------------------------------------------------------------------------------------------------------------------
CHANGES IN DIRECT SPENDING
Suspend Prohibition on Payments to Farms of 10 Acres or
Less:
Estimated Budget Authority.............................. 11 9 0 0 0 0 0 0 0 0 20 20
Estimated Outlays....................................... 11 9 0 0 0 0 0 0 0 0 20 20
Reduce Information Technology Funding:
Estimated Budget Authority.............................. -6 -7 -7 0 0 0 0 0 0 0 -20 -20
Estimated Outlays....................................... -2 -6 -7 -5 0 0 0 0 0 0 -20 -20
Total:
Estimated Budget Authority.......................... 5 2 -7 0 0 0 0 0 0 0 0 0
Estimated Outlays................................... 9 3 -7 -5 0 0 0 0 0 0 0 0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Basis of estimate: CBO estimates that suspending a
prohibition on certain agricultural income support payments
would increase direct spending. We also estimate that reducing
funds available to USDA for information technology would reduce
direct spending. Taken as a whole, CBO estimates that those
effects would fully offset each other, resulting in no
significant net change in direct spending over the next 10
years.
Increased payments to certain farmers and ranchers
The Food, Energy, and Conservation Act of 2008 prohibits
direct, counter-cyclical, or average crop revenue election
payments to producers of 20082012 crops if the sum of base
acres on the farm is 10 acres or less, unless the farm is owned
by a socially disadvantaged or limited resource farmer or
rancher, as determined by the Secretary of Agriculture. (The
Farm Act defines ``socially disadvantaged or limited resource''
farmers or ranchers as those who have suffered certain kinds of
discrimination.) Each farm's base acres are an average of the
number of acres planted in each crop (feed grains, oilseeds,
wheat, rice, cotton, and pulse crops) over a specified
historical period. A farm's base acres do not increase or
decrease over time.
According to USDA, about 255,000 farms in 2006 with total
crop base of 10 acres or less received about $23 million in
payments. Information from USDA also indicates that about one-
third of those payments were made to farms owned by socially
disadvantaged or limited resource farmers or ranchers. CBO
estimates that suspending the prohibition on payments to such
producers would increase direct spending by a total of $11
million for the 2008 crops and $9 million for the 2009 crops,
for a total of $20 million over the 2009-2018 period.
Reduced funding for information technology
Section 12021 of the 2008 Farm Act provided $15 million for
each of fiscal years 2008 through 2011 to purchase information
technology equipment for the federal crop insurance program.
H.R. 6849 would reduce the amount available to $9 million for
2009 and $8 million for each of fiscal years 2010 and 2011.
Based on historical spending patterns for such activities, CBO
estimates enacting this provision would reduce direct spending
by $20 million over the 2009-2018 period.
Intergovernmental and private-sector impact: H.R. 6849
contains no intergovernmental or private-sector mandates as
defined in UMRA and would impose no costs on state, local, or
tribal governments.
Estimate prepared by: Federal Costs: Jim Langley. Impact on
State, Local, and Tribal Governments: Burke Doherty. Impact on
the Private Sector: Amy Petz.
Estimate approved by: Theresa Gullo, Deputy Assistant
Director for Budget Analysis.
Performance Goals and Objectives
With respect to the requirement of clause 3(c)(4) of rule
XIII of the Rules of the House of Representatives, the
performance goals and objections of this legislation are to
amend the commodity provisions of the Food, Conservation, and
Energy Act of 2008 to permit producers to aggregate base acres
and reconstitute farms to avoid the prohibition on receiving
direct payments, counter-cyclical payments, or average crop
revenue election payments when the sum of the base acres of a
farm is 10 acres or less, and for other purposes.
Constitutional Authority Statement
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds the
Constitutional authority for this legislation in article I,
clause 8, section 18, that grants Congress the power to make
all laws necessary and proper for carrying out the powers
vested by Congress in the Constitution of the United States or
in any department or officer thereof.
Committee Cost Estimate
Pursuant to clause 3(d)(2) of rule XIII of the Rules of the
House of Representatives, the Committee report incorporates the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to sections 402 and 423 of the
Congressional Budget Act of 1974.
Advisory Committee Statement
No advisory committee within the meaning of section 5(b) of
the Federal Advisory Committee Act was created by this
legislation.
Applicability to the Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act (Public Law
104-1).
Federal Mandates Statement
The Committee adopted as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act (Public Law 104-4).
Earmark Statement Required by Clause 9 of Rule XXI of the Rules of the
House of Representatives
H.R. 6849 does not contain any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9(d), 9(e), or 9(f) of rule XXI of the rules of the
House Representatives.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
SECTION 1101 OF THE FOOD, CONSERVATION, AND ENERGY ACT OF 2008
SEC. 1101. BASE ACRES.
(a) * * *
* * * * * * *
(d) Treatment of Farms With Limited Base Acres.--
(1) * * *
* * * * * * *
(4) Suspension.--Paragraphs (1), (2), and (3) shall
not apply during the 2008 and 2009 crop years.
----------
SECTION 515 OF THE FEDERAL CROP INSURANCE ACT
SEC. 515. PROGRAM COMPLIANCE AND INTEGRITY.
(a) * * *
* * * * * * *
(k) Funding.--
(1) Information technology.--To carry out subsection
(j)(1), the Corporation may use, from amounts made
available from the insurance fund established under
section 516(c), [not more than $15,000,000 for each of
fiscal years 2008 through 2011] not more than
$15,000,000 for fiscal year 2008, not more than
$9,000,000 for fiscal year 2009, and not more than
$8,000,000 for each of fiscal years 2010 and 2011.
* * * * * * *