OREI is USDA’s flagship competitive research grants program dedicated to the investigation of organic systems.  OREI funds research and extension projects that provide the information that producers and processors need to be successful, improve their farming systems, and grow and market high quality organic agricultural products.

OREI has eight legislatively-defined goals, including:

1. Facilitating the development of organic agriculture production, breeding, and processing methods.
2. Evaluating the potential economic benefits to producers and processors who use organic methods.
3. Exploring international trade opportunities for organically grown and processed agricultural commodities.
4. Determining desirable traits for organic commodities.
5. Identifying marketing and policy constraints on the expansion of organic agriculture.
6. Conducting advanced on-farm research and development that emphasizes observation of, experimentation with, and innovation for working organic farms, including research relating to production and marketing and to socioeconomic conditions.
7. Examining optimal conservation and environmental outcomes relating to organically produced agricultural products.
8. Developing new and improved seed varieties that are particularly suited for organic agriculture.

Some changes to the FY 2012 Request for Applications:

• There will be a new project type offered to support development of data products and analytics on the impacts of research and extension activities funded by the Integrated Organic Program (Organic Agriculture Research and Extension Initiative and Organic Transitions Program) on the organic industry.
• No planning grants will be offered this year.
• A new priority is included in this year’s RFA to fund projects that develop cultural practices and other allowable alternatives to substances recommended for removal from the National Organic Program’s National List of Allowed and Prohibited Substances.

NIFA will be accepting feedback on how future RFAs can be improved.  See page 2 of the RFA for more information on submitting public comments.

OREI is set to expire on Sept 30th, 2012, and must be reauthorized in order to be offered again next year.  NSAC and our allies in the organic sector have long been champions of this program, and will be working hard to advocate for its reauthorization with mandatory funding in the upcoming farm bill debate.  We will be counting on our members and network of organic producers and consumers who depend on the research outcomes of this program to speak up for this vital research program, and make sure their legislators know the value of federal investments in research on organic production methods.

For more information on the Organic Agriculture Research and Extension Initiative, see our Grassroots Guide.  To apply for funding, click here.

In addition to improving organic crop insurance options, USDA plans to use the survey results to improve programs like the Environmental Quality Incentives Program for organic producers.  Additionally, USDA plans to use the results to evaluate whether to expand the Market Access Program to allow for more exports of organic products.  The survey results will also be used more generally to inform policies, funding allocations, and availability of services for organic growers.

Organic producers should be receiving the survey by mail and can respond by mail, internet, or phone, or by contacting a NASS representative.  To complete the survey online, producers should go to www.agcounts.usda.gov and enter the ID number printed on the mailing.  Responses are kept confidential.

To view USDA’s information sheet on the survey, click here.

The Beginning Farmer and Rancher Opportunity Act (BFROA) of 2011 has been introduced in Congress, and it’s our chance to break down the barriers to entry that impede new agriculture entrepreneurs from starting a farming business.  Your representative’s support is absolutely crucial to helping us build momentum for this important bill.

BFROA would improve existing credit programs so young and beginning farmers can access the financing necessary to run their businesses.  It would reauthorize important conservation programs that foster new life-long stewards of the land and encourage innovative strategies for land transfer and farm entry.  The bill also invests farm bill dollars in training veterans who want to launch a ranching or farming business.

New farmers can produce our nation’s food and fiber, protect and enhance our natural resources, and contribute to the revitalization of our rural and urban communities.  Will you ask your representatives’ to support this comprehensive and forward-thinking initiative today?

Thank you for taking action to ensure a healthy, safe, and prosperous future!

We previously reported to you that a 2011 Food and Farm Bill appeared imminent.  Days before Thanksgiving the Congressional “Super Committee” failed to reach agreement on $1.2 trillion in budget cuts.  With that, the 2011 Farm Bill proposal intended for inclusion in the Super Committee’s deficit reduction bill is thus no more.

The now dead 2011 proposal was a mixed bag to be sure.  However, because you made your voice heard, the short-lived 2011 Farm Bill contained some of sustainable agriculture’s conservation, local food, beginning farmer, and organic priorities.

There are many scenarios for what might happen next with the farm bill.  What’s clear is that a more traditional farm bill process will begin early next year.  We now have a prime opportunity to amplify our voices and push for a greener, healthier, and fairer food and farm system for consumers and family farmers!

We need your continued engagement to keep up the momentum and mobilize an even stronger front for the 2012 Food and Farm Bill Campaign.  Thriving family farms and sustainable and organic agriculture are critical to America’s economy, health, and environment.  Pass this link on to your friends and networks, build the sustainable and organic agriculture movement, and stay tuned!

Thank you for all you do!

The National Sustainable Agriculture Coalition Staff

To take action on two of our farm bill priorities, see the Beginning Farmer and Rancher Opportunity Act and Local Farms, Food, and Jobs Act.

To support our 2012 Food and Farm Bill Campaign, please make a tax-deductible donation today.  Thank you!

The five new members will serve five-year terms that begin in 2012.  USDA identified them and described their credentials as follows:

• Handler: Harold V. Austin, IV.  Mr. Austin is currently the Director of Orchard Administration for Zirkle Fruit Company, an organic tree fruit grower and shipper.  He is also a member of the Washington State Department of Agriculture’s Organic Advisory Board, the Northwest Horticultural Council’s Science Advisory Board, and Washington State University’s Leadership Team.  He has been a leader in the organic tree fruit industry for years and has had broad exposure through the marketing segments following produce from the farm to the marketplace.

• Producer: Carmela Beck.  Ms. Beck is the National Organic Program Supervisor and Organic Certification Grower Liaison for Driscoll’s, an organic berry producer.  She is a member of the CCOF Government Advisory Council, the Organic Trade Association Mexico Task Force and Latinas in Agriculture.  She brings along extensive knowledge and experience with organic certification.  Her familiarity with California agriculture in particular, where the majority of U.S. organic produce is grown, will enhance the knowledge base of the board.

• Environmentalist: Tracy Favre.  Ms. Favre is the Chief Operating Officer for Holistic Management International, an international non-profit group whose mission is to educate about how to manage land sustainably.  She has 17 years of experience working with municipal and industrial clients on watershed management projects as an environmental engineering consultant.  She also authors technical articles for industry journals and serves as a subject matter expert.

• Consumer/Public Interest: Jean Richardson, Ph.D., Professor Emerita.  Dr. Richardson is Professor Emerita of Natural Resources, Environmental Studies and Geography at the University of Vermont.  She is also a maple syrup producer, organic inspector and independent contractor for matters relating to rural development, agriculture and the environment.  She has served on the board of directors of the Vermont Natural Resources Council, Northwest Medical Center, and the National Wildlife Federation. She was also appointed by President Clinton to represent the United States on the NAFTA Commission for Environmental Cooperation.  She brings to the board an extensive background in public policy and sustainable development as well as her understanding of organic agriculture due to her work as an organic inspector.

• Scientist: Andrea (Zea) Sonnabend. Ms. Sonnabend is the Policy Specialist and Organic Inspector Specialist for CCOF, an organic certifier based in California.  She has served on the board of the Organic Materials Review Institute, the Organic Seed Alliance, the International Organic Inspectors Association, and the California Department of Agriculture Invasive Species Advisory Council.  She has extensive scientific knowledge and experience with materials used in organic production and handling. Formerly, she served as a technical advisor to the NOSB from 1993 to 1995.

Authorized by the Organic Foods Production Act of 1990, as amended (7 U.S.C. 6501 et seq.), the NOSB is responsible for making recommendations about whether a substance should be allowed or prohibited in organic production or handling; assisting in developing standards for substances used in organic production; and advising the Secretary on other aspects of the Act’s implementation.  Each spring, the NOP invites nominations to the NOSB.   Applicants may self-nominate or be recommended by other individuals or organizations.

NRCS will have three ranking periods in 2012 for the On-Farm Energy, Organic, and Seasonal High Tunnel Pilot Initiatives, which will end on February 3, March 30, and June 1.  These three initiatives are offered in all 50 states, along with the Caribbean Area and the Pacific Basin.

For the Air Quality Initiative, NRCS will have two ranking periods in 2012, ending on February 3 and March 30.  This initiative is only available in counties with serious air quality resource concerns in nine states:  Arizona, California, Colorado, Illinois, Montana, New York, Ohio, Pennsylvania, and Texas.

At the end of each ranking period, NRCS will evaluate all proposals submitted by that date for each initiative and determine which proposals receive funding.

Previously, each of these programs held only one ranking period per year.  By establishing multiple ranking dates, producers can have more time to choose which programs to apply to, and ultimately more producers will be able to apply to each initiative.

Background

The On-Farm Energy Initiative was initially introduced in 2010, at which point its availability was limited to 29 states.  Since then, it has expanded to all 50 states and the US territories. It funds the development of Agricultural Energy Management Plans (AgEMP), or farm energy audits, which evaluate energy use on a farming operation.  This includes evaluating energy use in the field, such as in farming equipment and farming processes, as well as energy use at farm headquarters, such as in buildings and facilities.

The Organic Initiative provides funds to certified and transitioning organic producers to cover conservation measures specific to organic systems.  It was first offered in 2009.

On Monday, November 14, 2011, NRCS released the FY 2012 National Bulletin on the Organic Initiative.  Over the past three years of the program, the Organic Initiative has obligated $36.3 million (FY 2009), $23.8 million (FY 2010), and $22.4 million (FY 2011) nationwide.  More than 1,660 producers have now signed up for the Initiative.  For more detailed information on the FY 2011 sign up, you can download a state-by-state breakdown of the number of acres treated, contracts signed, dollars obligated, and practices used.

The Seasonal High Tunnel Pilot Initiative was first offered in 2010.  This is the first year that it will be offered as the National Seasonal High Tunnel Initiative, rather than as a practice standard through the Pilot Initiative.  NRCS provides funds through the Initiative to help producers design and install high tunnels that extend the growing season without using any electrical, heating, and/or mechanical ventilation systems.  In FY 2010, this initiative funded 2,395 high tunnel projects, and in FY 2011, it funded 2,035 high tunnel projects.  For more detailed information on the FY 2011 sign up, you can download a breakdown of the number of high tunnels by state.

The Air Quality Initiative funds conservation measures — such as installing windbreaks, developing nutrient management practices, pumping plant engines, and waste treatment lagoons — that address air quality concerns on farming operations.

What We Know About the Farm Bill that Did Not Happen – The Basic Outline

The basic cost-cutting outline of the farm bill deal did not change in gross terms from the time the Agriculture Committee leaders signaled to the Super Committee that they would aim to cut a net of $23 billion over the next decade.  The final deal tracked the original numbers – a $15 billion net cut in commodity programs, a little over $6 billion net cut in conservation programs, and a $4 billion slice from the largest of all farm bill programs, the SNAP or food stamp program.  About $2 billion was thereby freed up to help fund farm bill programs that lacked secured budget baseline after the current farm bill expires in 2012 and to fund new programs.

In round numbers, the combined commodity and crop insurance subsidy programs would therefore be cut by 10 percent, the conservation programs by 10 percent, and the food stamp program by a small fraction of one percent.   The conservation cut, however, would be considerably larger if the “changes to farm bill mandatory spending programs” in the agricultural appropriations bills are added, bringing the total to 15 percent, and much more than that if the appropriations bill continues in the same direction as this year.

Based on the best information available to us, the following should be a fairly accurate summary of some key provisions in the new proposed farm bill.  We stress, however, that without access to the bill itself or even an up-to-date detailed summary, we cannot be absolutely sure about each and every detail.

What We Know About the Farm Bill that Did Not Happen – Some Highlights

Local Food and Nutrition — The proposed bill adopted the policy provision contained in the Local Farms, Food, and Jobs Act (LFFJA) for a competitive grants program that combined direct marketing promotion (formerly Farmers Market Promotion Program) and scaling up of local food systems for larger scale retail and institutional markets.  Called the Farmers Market and Local Food Promotion Program (FMLFPP), the proposed bill would have funded the program at $100 million in mandatory money over five years.  The LFFJA advocates for $30 million a year, or $150 million over five years.

The Community Food Projects, a competitive grants program that aims to fight food insecurity by supporting the development of community-based food projects in low-income communities, would have received an increase in funding from $5 million a year to $10 million a year.  The LFFJA also includes this policy provision.

The proposed bill would have created a new nutrition incentives program, called Hunger Free Communities Incentive Grants.  Advocated for by the Fair Food Network, Wholesome Wave, and others, and modeled after already-existing state and regional examples, this new program was slated in the proposed bill to receive $100 million in mandatory funding over five years and would have incentivize purchases of fresh produce by SNAP participants at farmers markets and other direct marketing outlets.

Beginning Farmers — The Beginning Farmer and Rancher Development Program (BFRDP) provides grants to institutions and organizations that offer education, training and outreach to beginning farmers and ranchers.  This program was slated to receive $50 million over the next five years, which is a significant decrease from its current mandatory funding levels of $75 million, and far less than the $125 million included in the Beginning Farmer and Rancher Opportunity Act and advocated by NSAC.  However, BFRDP has no baseline after fiscal year 2012, so although funding is less than current levels, it nonetheless represented $50 million in new money over the next five years.

Organic Agriculture — The Organic Agriculture Research and Extension Initiative (OREI), which provides competitive grants to fund public research on organic production systems, was slated to receive renewed mandatory funding of $80 million over five years, with an authorization for an additional $25 million in annual appropriations.  This is a slight increase in funding from its current mandatory funding of $78 million during the life of the 2008 Farm Bill.  However, per year funding levels would have decreased slightly from $20 million to $16 million, since OREI was funded at lower levels in fiscal year 2008.

The Organic Data Initiative (ODI), which facilitates USDA data collection efforts for the organic sector, would have also received a renewed $5 million in mandatory funding, plus an authorization for annual appropriations, in the proposed bill.

The National Organic Program (NOP), which administers the USDA organic certification program, was slated to receive first-time ever $5 million in mandatory funding, plus authorization for appropriations up to $15 million per year.

Specialty Crops — The Specialty Crop Block Grant (SCBG) program provides grants annually to assist State Departments of Agriculture in enhancing the competitiveness of specialty crops (fruits, vegetables, tree nuts, and nursery crops).  The program would have received an increase in mandatory funding from $55 million a year to $70 million a year.  On the negative side, though, the policy provisions for this program contained in the Local Farms, Food, and Jobs Act (LFFJA) were not included.  LFFJA includes set-asides of program funds for local and regional specialty crop market development and research and includes a more equitable division of program funds across the specialty crop sector.

The Specialty Crop Research Initiative (SCRI), which funds research on fruits, vegetables, and other non-commodity crops, was slated to receive renewed funding at $40 million per year, over ten years – a slight decrease from its current annual funding levels of $50 million.  The SCRI has no baseline for funding beyond fiscal year 2012, so this would have represented $400 million in new money over the next ten years and ensured funding would be available for this program in the following farm bill.

Crop Insurance — The proposed bill’s crop insurance title included a provision in the Local Farms, Food, and Jobs Act (LFFJA) that would have authorized the Risk Management Agency (RMA) to develop a whole farm revenue insurance product for diversified operations, including specialty crops and mixed grain/livestock or dairy operations.  As in the LFFJA, the proposed bill would have set the coverage level at 85 percent, provided a bonus for diversification, and classified costs necessary to get products to market (e.g. the cost of packing materials) as allowable costs.  Unlike the LFFJA, in the proposed bill, RMA would have had the option of contracting out the development of the new product if it decided not to do it in-house.

The proposed bill would also have increased the incentive for private consulting firms to develop new risk management products for specialty crops, and would have returned to RMA the general authority to develop products in-house.

Renewable Energy — As far as we know, only one program within the Energy Title of the proposed bill was slated to receive renewed mandatory funding.  The Rural Energy for America Program (REAP), which has been funded in the current farm bill cycle partly by mandatory funds and partly by appropriated funds, would have continued down that path, though with a very significant reduction in mandatory funds.

The mandatory funding for the controversial Biomass Crop Assistance Program (BCAP) would have been allowed to expire in the proposed bill, but the program would be authorized to receive up to $75 million in annual appropriations for projects and for collection, harvest, storage, and transportation.

What We Know About the Farm Bill that Did Not Happen – Conservation Title

If the proposed farm bill had become law, the total cut to the Conservation Title would be $6.3 billion over ten years.  Roughly 60 percent of the cut to conservation ($3.8 billion) would come from the Conservation Reserve Program (CRP).  The program’s total acreage cap would be ratcheted down over 3 years from its current level of 32 million acres to 25 million acres.  To a significant degree, this reduction would track changes in CRP enrollment expected as a result of market forces, though with the declining cap the opportunity for new general sign-ups would be small.

Related to CRP, $25 million in renewed funding would have been retained for the CRP-Transition Incentives Program (CRP-TIP), which offers a special incentive of two years of extra CRP rental payments to owners of land that is currently in the CRP but returning to production, who rent or sell to beginning or socially disadvantaged farmers and ranchers who will use sustainable grazing practices, resource-conserving cropping systems, or transition to organic production.  The bill would not have expanded CRP-TIP to cover intra-family deals under certain circumstances, as had been proposed in the Beginning Farmer and Rancher Opportunity Act (BFROA).

The proposed bill would have cut the Conservation Stewardship Program (CSP) by $2 billion, or approximately 10 percent.  The average payment rate would have remained at $18 per acre, however the acreage cap would be reduced to 10.34 million acres a year from 12.769.  The proposed farm bill also included a number of positive substantive changes to CSP beyond the numbers.

The proposed bill would have combined the Environmental Quality Incentives Program (EQIP) and the Wildlife Habitat Incentives Program (WHIP) into a single program and cut total funding by $1.865 billion, or approximately 10 percent.  As has always been the case for EQIP, 60 percent of the consolidated program’s funding would go to livestock operations.  The program would have also included a 5 percent set aside for wildlife in lieu of WHIP.  The statutory language that led to creation of the EQIP Organic Initiative would not change.  Both the Beginning Farmer and Rancher and Socially Disadvantaged Farmer and Rancher set asides within EQIP would have been retained at 5 percent.  The advanced EQIP cost share for Beginning, Socially Disadvantaged, and Limited Resource Farmers and Ranchers would have also been retained at 30 percent, as opposed to 50 percent proposed by the Beginning Farmer and Rancher Opportunity Act.

The proposed bill would also have combined the Cooperative Conservation Partnership Initiative (CCPI), Agricultural Water Enhancement Program (AWEP), Chesapeake Bay Watershed Initiative (CBWI), and Great Lakes Restoration Initiative (GLRI) to create a single regional partnership program.  While the CBWI and AWEP had a combined baseline of $1.1 billion through 2012, the new regional partnership program would have had a $1 billion baseline, equating to a $100 million or slightly less than 10 percent cut.  Like the current CCPI, 6 percent of EQIP and CSP funds would be reserved for the regional partnership program.  However, unlike the current CCPI statute, which splits funding authority between the states (90 percent) and national (10 percent), the new bill would have split the authority between national (50 percent), states (25 percent), and “critical areas” (25 percent), which would include the Chesapeake Bay, Puget Sound, Ogallala Aquifer, Red River, Great Lakes, Everglades and other areas determined by the Secretary.  The regional partnership program would also have had an easement option through existing programs, such as the Conservation Reserve Enhancement Program (CREP).

On the easement side of the Title, three programs–the Wetlands Reserve Program (WRP), Grasslands Reserve Program (GRP), and Farm and Ranch Lands Protection Program (FRPP)–would have been combined into a single easement program with two branches.  The first branch would combine FRPP and GRP into an ‘agricultural lands easement program.’  The second branch would consist of wetlands easement program very similar to the WRP.  Nationally, the split between wetland easements and agricultural land easements would be 60/40, respectively; however, each state conservationist would be able to request an adjustment to that split to better reflect the needs of their state.  Perhaps most importantly, the easement program would have had a 10-year baseline of $3.2 billion.  The WRP and GRP have been funded one farm bill at a time, so while the funding available, especially for WRP, would be lower, the tradeoff was to create a permanent, more secure baseline.

The bill would have made no changes to the Agricultural Management Assistance (AMA) program.  It would have funded the Voluntary Public Access (VPA) program at $30 million and the Watershed Rehabilitation Program at $150 million over the course of the farm bill.  The VPA program and Water Rehabilitation Program previously had $50 million and $100 million, respectively, and both lack baseline funding after 2012 if not renewed.

Finally, under the proposal, all conservation programs would now be “no year funding” programs, which means that unused money in a given year does not revert back to the general treasury.  Under current law, if a conservation contract is broken, for example, because a contract holder dies or just decides not to go through with a conservation project, that money must be sent back to the treasury.  A significant amount of mandatory conservation money is lost from the Conservation Title through this process.  Instead, under a situation like the one described above, the money would be retained within the Conservation Title.

What We Know About the Farm Bill that Did Not Happen – Some Lowlights

Commodity Payments – The commodity title of the proposed farm bill would have replaced direct payments (payments based on historical base acres and paid each year regardless of market price or farm income conditions) with a “grab bag” of commodity support options.  Producers would be able to decide which program to enroll in.

One option included a farm-level shallow loss program to pay commodity crop producers when they experience small but long-term losses in revenue.  Payments would cover losses between 13 and 25 percent, would be triggered by revenue circumstances at the individual farm level, and would be made on 60 percent of planted and prevented planted acres.  It was expected that many corn, soy, and wheat producers would choose this option, though likely a considerably smaller percentage than if it were the only option available.

A second option was substantially higher target prices with ongoing receipt of counter cyclical payments when prices fall below the target, expected to be of most interest to rice, peanut, and sorghum producers, but perhaps many corn, soy, and especially wheat producers as well.

A third option was a special revenue insurance program for cotton (only) known as the Stacked Income Protection Plan or STAX.  The movement of cotton’s share of commodity title funding to the crop insurance side of the ledger, via STAX, would have moved cotton out of adjusted gross income eligibility standards, payment limitations, and conservation requirements.

Due to the proposed termination of direct payments, saving nearly $5 billion a year, and to the relatively rosy projections of future commodity prices over the next decade, all of these commodity options could be put in the bill and estimated to result in a $15 billion savings over the next decade, or about $1.5 billion a year.  If, however, a substantial price drop occurred outside the predicted range, the taxpayer exposure could be very high, easily wiping out any savings.

Payment Limits and Adjusted Gross Income (AGI) — The new payment limitation for the shallow-loss revenue program option and counter-cyclical program option would have been $210,000 for a married couple.  This is significantly higher than the current $130,000 payment limit for counter-cyclical and revenue insurance payments.  The new higher payment limit is the result of adding the current $80,000 payment limit for direct payments to the total.  This outcome is baffling, given that direct payments were being proposed for elimination.

(Note: The proposal to the Super Committee from Senators Grassley (R-IA) and Johnson (D-SD), which had NSAC’s support, would have established a $100,000 per farm annual limit on revenue and counter-cyclical payments.  In June, Grassley and Johnson introduced the Rural America Preservation Act of 2011 to lower the per farm cap on farm commodity program payments, simplify eligibility, and ensure that payments flow to working farmers.  Visit our blog on the bill to read more about their effort to build a reasonable payment limit into the new farm bill.)

The proposed bill would have done nothing to close the biggest legal loophole that has been built into the support system over the last two decades, a loophole that allows individual farming interests to secure nearly unlimited taxpayer support.  The loophole — allowing people to dodge the requirement to be “actively engaged in farming” to be eligible for support — allows mega farms to capture multiples of the nominal payment limit.  These taxpayer-provided funds in turn can be used to bid land away from young, beginning farmers trying to get a start in farming.  Unlimited payments over-inflate land values, increasing the land carrying costs for all farmers.

The proposed bill included no limit at all on marketing loan gains or loan deficiency payments, no limit at all on STAX subsidies, and no limit at all on highly subsidized crop insurance premiums.  For each of those, the sky was the limit.

Finally, the adjusted gross income (AGI) limit for eligibility for commodity and conservation program payments was proposed to be $950,000, including both farm and non-farm adjusted income (generally multiplied times two if married).  This is down $50,000 from the $1 million limit that was included in the FY 2012 agriculture appropriations bill that became law last week.  The AGI test excludes from income all regular business expenses including the costs of renting or purchasing additional land or equipment; hence the AGI test  encourages farm expansion by anyone who receives commodity subsidies and makes more than a million dollars a year, or a couple of million in the case of married persons.

For more information on payment limits, visit NSAC’s commodity program payment limitations and adjusted gross income limitations page.

Conservation Compliance — Despite the call of 56 national farmer and conservation organizations, including NSAC, to maintain and strengthen conservation compliance provisions in the farm bill, the bill would neither reattach conservation compliance to crop insurance nor establish a nationwide Sodsaver provision.  Conservation compliance helps ensure that producers do not farm the most environmentally sensitive land, primarily highly erodible land and wetlands.  In 1985, conservation compliance requirements have applied to commodity, crop insurance, and conservation program payments, but since 1996 it has not applied to receipt of crop insurance subsidies.

With direct payments gone, the proposed new farm bill would have only applied this minimum standard of environmental protection to counter-cyclical payments and the shallow-loss revenue insurance program.  There would be no conservation compliance requirements for those who choose to receive STAX benefits or those who receive crop insurance subsidies only.  NSAC has consistently advocated that crop insurance, which is the single largest farm subsidy, should be part of the same social contract that applies to commodity, credit, and conservation programs.

The agreement also did not include a nationwide “Sodsaver” provision.  Sodsaver would have strengthened existing compliance rules by prohibiting all commodity and insurance subsidies on all native prairie and permanent grasslands and other remaining native land that does not have a cropping history if such land were to be cropped.  In doing so, it would have protected prairie, critical habitat and biodiversity, reduced the cost of subsidy programs, and taken the pressure off of already over-subscribed conservation incentive programs.  This Sodsaver provision was included in the last farm bill, but only as a voluntary pilot project that never got off the ground.

The bottomline is the proposed bill’s commodity and crop insurance titles would have encouraged and subsidized farm consolidation and diminish economic opportunity for young and beginning farmers.  It would have created a “too big to fail” protection that could have left the taxpayer with a huge new exposure should the market tumble.  Despite an ongoing economic crisis and need to spur rural job growth, the bill would have maximized payments and insurance subsidies to the nation’s largest farms while putting almost no money into rural economic development.  There would have also been no improvements at all to the existing weak set of conservation conditions required as a condition of being eligible for production subsidies, and no re-linkage to crop insurance subsidies.  These are all very major failings that need to be addressed when farm bill consideration resumes.

Rural Development –The Rural Development business programs did not fare well in the bill from a funding standpoint.  The Value-Added Producer Grant (VAPG) program, which provides competitive grants to create or develop value-added producer-owned businesses, would have been the only rural development program to receive farm bill funding.  The VAPG program, however, would have received only $15 million in mandatory funding over five years, a very nominal amount.  This is the same amount of funding from the 2008 Farm Bill, which was used up entirely in the first year of that farm bill cycle.  In LLFJA and the BFROA, NSAC is advocating for $30 million per year in mandatory funding for the program, which has a proven track record in boosting farm income and creating rural jobs.  The proposed bill would have authorized up to $40 million a year in discretionary funding, the same as under current law, but current appropriations are at only 40 percent of that level and the pressure on appropriations bills from discretionary cuts already approved by Congress will grow each year.

The Rural Microenterprise Assistance Program (RMAP) provides entrepreneurs in rural areas with the skills necessary to establish new businesses and continue operation of existing rural microenterprises.  While the 2008 Farm Bill included $15 million over four years in mandatory funding for the program, the proposed new bill would have included no mandatory funding for the program at all and authorized only $20 million a year in discretionary funds compared to $40 million a year last farm bill cycle.

Additionally, many of the policy proposals included in the Local Farms, Food, and Jobs Act (LFFJA) that would bolster “food hub” and value chain activities are not found in the new bill.  For instance, the Business and Industry (B&I) Direct and Guaranteed Loan Program bolsters rural businesses and industries and includes a minimum five percent set-aside for local and regional food system activities including aggregation, storage, processing, distribution, and marketing.  LFFJA proposes an increase of this set-aside to ten percent and makes other improvements; however, the proposed new bill did not adopt this proposal.

Local Food and Nutrition – The proposed new bill did not contain any of the EBT or school food provisions contained in the LFFJA.  The LFFJA includes a leveling of the playing field so that direct marketing outlets such as farmers markets and CSAs can serve as SNAP vendors just as wired retail outlets do.  The LFFJA’s school food provisions includes a “local food credit program” that would allow School Food Authorities to use up to 15 percent of their commodity dollars for making purchases of agricultural products from local and regional farmers and ranchers.  Not only would this foster economic development but it would also bolster farm to school relationships.  Additionally, while the proposed new bill would have maintained funding for the Department of Defense Fresh program, which gets produce into schools, the bill would not have allowed schools to use these dollars for their own purchases of more fresh, local food.  On a positive note, the proposed new bill would have allowed USDA’s Agricultural Marketing Service to continue to pursue a pilot program that explores avenues for local sourcing in the program.

Organic Agriculture — The National Organic Certification Cost Share Program (NOCCSP), which assists producers in 34 states and handlers in all 50 states with the regulatory costs of entering into organic production, was left in tatters in the proposed new bill.  It would have ended any farm bill mandatory funding for the program and placed a five-year benefit limit on each farmer if, as is unlikely, the program were to shift from the farm bill to the appropriations bill.  The proposed bill would have allowed farmers in the 12 Northeastern states plus HI, NV, UT, and WY to receive mandatory funding from a different source for organic certification cost share.  The result would have been an absurd situation where eligibility for a farm program benefit depended on which state one resides in.  For comparison, imagine if corn program subsidies were available only in 16 out of 50 states – it would not have passed the smell test.

The proposed bill also did not include the provisions in the Local Farms, Food, and Jobs Act (LFFJA) regarding organic crop insurance.  The LFFJA would eliminate the organic premium surcharge and would direct RMA to complete development of an organic price series to allow organic policies to pay out at the organic price.

Minority Farmers and Ranchers

The proposed bill left the Outreach and Technical Assistance for Socially Disadvantaged Farmers and Ranchers program (also known as “Section 2501” program) high and dry.  The program received $75 million in mandatory funding under the current farm bill, but was left unfunded in the proposal.

Beginning Farmers and Ranchers

The Beginning Farmer and Rancher Individual Development Accounts (BFRIDA) Pilot Program also was not provided with farm bill funding under the proposal.  The Beginning Farmer and Rancher Opportunity Act proposes to fund the innovative pilot program at $5 million a year in mandatory funding.

Many credit programs that are essential to helping beginning farmers start farming, would have been reauthorized, including the Conservation Loan Program, the Down Payment Loan Program, and funding set-asides for beginning farmers within the guaranteed farm ownership and direct operating loan funds.  None of the important policy changes that are needed and are contemplated by the Beginning Farmer and Rancher Opportunity Act were included, however.

Research and Extension

While the proposed bill would have provided important renewed mandatory funding for the Specialty Crop Research Initiative, Organic Agriculture Research and Extension Initiative, and Beginning Farmer and Rancher Development Act, it contained no policy changes that we know of to other programs and offices with the research area.

This bulletin provides guidance to State Conservationists for administering the EQIP Organic Initiative in FY 2012.  The Organic Initiative provides funds and technical assistance to certified organic, exempt organic, and transitioning organic producers to instal conservation practices related to organic production.  A number of changes have been made to the National Bulletin for FY 2012:

• The Organic Initiative will now require transitioning producers and exempt organic producers to self-certify that they agree to develop and implement an Organic Systems Plan in order to receive assistance through the Organic Initiative.  Transitioning producers must also prove that they have contacted a certifying agent and begun the process of transitioning to certified organic production.

• National Headquarters has created a list of 64 conservation practices and Conservation Activity Plans that states must offer.  This differs from the previous two years, when each state determined which practices it chose to offer.  However, a state conservationist can request a waiver to omit individual practices if they are deemed unnecessary.  We expect that many states will request exemptions for a least some of these 64 practices.

• National Headquarters will determine national ranking criteria for the Organic Initiative, and the national office will essentially eliminate state ranking criteria by rolling the state criteria in with the national criteria.  National ranking criteria will account for seventy-five percent of available ranking points.  States will develop local ranking questions, which will account for twenty-five percent of available ranking points.

• NRCS has established three application periods for the Organic Initiative in FY 2012, which is a change from the single application period that existed in previous fiscal years.  National Headquarters will establish a threshold ranking score for each application period, and all EQIP applications with scores that meet or exceed the threshold score in a given application period may receive funding.  Period 1 ends on February 3, 2012, Period 2 ends on March 30, 2012, and Period 3 ends on June 1, 2012.  The threshold ranking score will change with each successive application period, and any eligible applications below the threshold score in a given application period will be considered for funding during future application periods.

• National Headquarters will initially allocate only a portion of the total available Organic Initiative funds to states, which states can then use to obligate funds to contracts in Period 1.  If states need additional Organic Initiative funds during any application period, the state conservationist can submit a request for an allowance change.  It is our understanding that NRCS National Headquarters will make it easy for states to receive additional funding when needed.

• NRCS plans to develop a national web site for the EQIP Organic Initiative, which will include information on application periods and national bulletins.  Each state will have a web page that links to the national web site.

• Each state will update their state contact person for the Organic Initiative.

State conservationists must complete the required actions by November 25, 2011, four working days from today.  The National Bulletin expires on September 30, 2012, when NRCS will publish updated guidance on administering the EQIP Organic Initiative.

In addition the agriculture appropriations bill, the minibus includes the Commerce-Justice-Science and the Transportation-Housing and Urban Development funding bills as well as a new continuing resolution, which extends FY 2011 funding levels through December 16, 2011 for programs that have not received an FY 2012 appropriation.  The current continuing resolution keeping the government funded expires on November 18.

The final FY 2012 agriculture appropriations bill provides for $19.8 billion in discretionary spending, which is $350 million below last year’s level and $2.5 billion below the President’s request.

For a comparison of the negotiated bill, known as a Conference Report, with the original House and Senate bills, you can download the latest version of our annual appropriations chart.

Raid on Conservation Programs

The final FY 2012 bill cuts more than $927 million from farm bill mandatory conservation, on top of the half billion dollar cut contained in the FY 2011 agriculture appropriations bill.  If we include the renewable energy programs, this number jumps to approximately $1.2 billion.  Conservation and renewable energy were the primary farm bill mandatory programs cut.  Commodity, crop insurance, and export subsidies were left unscathed, as was the SNAP (food stamps).

The final FY 2012 agriculture appropriations bill cuts the Conservation Stewardship Program (CSP) by $75.5 million, roughly 9 percent, relative to its FY 2012 farm bill-mandated level.  This cut will reduce the size of the 2012 CSP sign-up by more than 30 percent.

The final bill also cuts the Environmental Quality Incentives Program (EQIP) by $350 million, or 20 percent.  The Wetlands Reserve Program (WRP) and Grasslands Reserve Program (GRP) are cut by roughly $200 million (32 percent) and $30 million (25 percent), respectively, while the Farm and Ranch Lands Protection Program (FRPP) and the Wildlife Habitat Incentives Program (WHIP) are cut by $50 million (25 percent) and $35 million (41 percent), respectively.  As in both the House and Senate bills, the Voluntary Public Access and Habitat Incentive Program (VPA-HIP) was zeroed out.

Taken together with what is rumored to be at least a $6 billion 10-year cut to conservation programs, the cuts to farm bill conservation programs would total $9 billion, or nearly 15 percent, considerably more than the proposed 10 percent cut to commodity and crop insurance subsidies in the pending farm bill deal.  NSAC has consistently said it will oppose a farm bill with a disproportional cut.

If one assumes that continued pressure on the agricultural appropriations bill from the $1 trillion reduction in appropriations over the next ten years approved by Congress in August will tend to keep forcing cuts to mandatory conservation, and if one further assumes that  the lackluster performance of the Agriculture Committees in defending their own mandatory spending during consideration of the FY 2012 appropriations bill will continue, it would then appear safe to say, based on the evidence at hand, the actual cut to conservation programs being contemplated now by the combined forces of the Appropriations and Agriculture Committees would be vastly higher, closer to $15 to $20 billion of ten years, or approaching a 30 percent cut.

In addition to the cuts to mandatory conservation funding, the bill cuts the Natural Resources Conservation Service’s (NRCS) conservation operations budget that pays for technical assistance by $44 million to $828 million.  NRCS uses conservation operations money to provide technical assistance to farmers and ranchers in the development of conservation plans and enrollment in conservation programs.  Lack of adequate technical assistance funding has become a chronic problem at USDA.

Energy Programs Slashed Too

A number of mandatory renewable energy programs were also cut in the conference bill.  Spending on the Biomass Crop Assistance Program (BCAP) is capped at $17 million, which is a 62 percent cut below the $45 million in remaining (unobligated) FY 2012 funds.  The Renewable Energy for America Program (REAP) received only 31 percent ($22 million) of its farm bill-mandated funding.

Rural Development and Farm Loans

The final bill makes significant cuts to a number of critical programs that create jobs and help rural communities thrive.  The bill cuts the Value-Added Producer Grants (VAPG) program to $14 million, roughly 35 percent of its authorized level and 26 percent less than what went out the door in 2011.  Surprisingly, the conferees chose to adopt the House proposal to zero out the Rural Micro-entrepreneur Assistance Program (RMAP) completely in FY 2012, despite existing grantees being due technical assistance funding based on their micro lending to date.  The Rural Business Enterprise Grants program was cut by 37 percent to roughly $24 million, while the Rural Business and Industry (B&I) loans program was cut by 17 percent relative to FY 2011.  With the B&I cut, approximately $41 million will be available in FY 2012 for loan guarantees for local and regional food enterprises.

The final bill funds direct operating loans at close to $1.05 billion, as requested in the President’s budget.  Unfortunately, it also matches both bills’ funding for direct farm ownership (DFO) loans at $475 million, which is 27 percent lower than 2010 levels.  The FY 2011 agriculture appropriations bill first reduced the DFO loan program level from $650 million to $475 million.  Not surprisingly, this has resulted in a $129 million backlog of approved applications for DFO loans, nearly half of which are beginning farmers.  The chances of real estate deals remaining in play after long delays in receiving approved loans are slim, resulting in the loss of new farming opportunities.

Research, Education, and Extension

Fortunately, the conference report maintains level funding for the Sustainable Agriculture Research and Education (SARE) program at $19.2 million.  As has been the case for many years, this does not include the $10 million requested by USDA to launch the SARE federal-state matching program.

Funding for the Organic Transitions Research Program and the Agriculture and Food Research Initiative (AFRI) was also maintained at FY 2011 levels.  Farm bill mandatory funding for the Organic Research and Education Initiative (OREI), Specialty Crop Research Initiative (SCRI), and Beginning Farmer and Rancher Development Program (BFRDP) were left intact.

Finally, the bill funds the National Sustainable Agriculture Information Service program (popularly known as ATTRA) at $2.25 million in FY 2012.  While not the $2.8 million funding level the program has maintained for many years, it is $2.25 million more than the zero dollars the program received in FY 2011 and thus an important step forward.  We are glad to see that this incredibly important program has been revitalized.

GIPSA Rule Travesty

One of the biggest travesties of all in the conference report is the Conference Committee’s handling of the livestock and poultry fair competition and contract reform rule, widely known as the “GIPSA rule” after the name of the agency (Grain Inspection, Packers and Stockyards Administration) that issued the proposal.  The rule was mandated by the 2008 Farm Bill.

The final appropriations bill bars any rule to eliminate the activist court-fashioned requirement that farmers and ranchers prove an injury to market competition from unfair or deceptive practices used against them as individuals by packers and processors; proposed rules that give definitions to unfair, unjustly discriminatory and deceptive practices or abuses; proposed rules to give definition to the prohibition on undue or unreasonable preferences; and proposed rules requiring packers and processors to make available sample production contracts.   The bill also prevents any final rule or interim rule from being published or otherwise implemented if the rule concerns the poultry tournament system.

The conference bill also prohibits the implementation of any of the proposed rules if the annual cost to the economy of such rules exceeds $100,000,000, while potential benefits will not be considered.  If its costs do not exceed $100,000,000, the bill allows the remaining poultry rules to be implemented, if the rules are published in the Federal Register no later than December 9, 2011.  This means if OMB can get its act together in time, anything left by the Report of the Final Rule sent to OMB for consideration by USDA might squeak under the wire.  The Report requires a 60-day delay after publication before this rule could be become effective.

Background Maneuvering by USDA on GIPSA Rule

To understand the complex nature of the stipulations in the appropriations bill it helps to know what USDA proposed last week.  Just as the appropriations conference was about to start, USDA announced that it had sent some of the GIPSA rules proposed by the agency in June 2010 to the Office of Management & Budget (OMB) as a Final Rule.  These rules focus on the poultry sector and include provisions in the 2008 Farm Bill concerning suspension of delivery of birds by poultry processors, measures addressing additional capital requirements, such as improvements to poultry houses, required after growers enter producer contracts with poultry processors, measures concerning notice for breach of contract, and requirements for processors to provide sample swine and poultry contracts.

USDA also sent to OMB, as an Interim Rule open to additional comment, the provision from the proposed rule on poultry tournament systems, which are used by the processors to compare poultry growers against each other in determining payment for their birds.

USDA decide to completely drop several provisions from the fair markets for livestock portion of the proposed rule, including a ban on packer-to-packer sales and the use of a single buyer at livestock auctions, as well as requirements for packers to retain records about the basis for pricing.

Finally, USDA announced it was still considering and, therefore, delaying finalization of other measures in the proposed regulations including eliminating the need for farmers and ranchers to prove injury to competition in markets for their products in addition to showing that they had been injured by a deceptive or unfair practice.  These core sections of the rule would be revised and issued as new proposed rules, starting the long rulemaking process all over again.

The conference agreement follows the USDA announcement closely, with the major change being upending the reform of the tournament system.  Otherwise, the agreement allows for the contract reform provisions that are in the process of becoming final to proceed, and then effectively kills everything else.  Many observers feel this is not a coincidence but rather something orchestrated ahead of time by the Administration and the industry giants, though we are unaware of any specific evidence of such collusion.

Local and Regional Food Systems

As we previously reported, the House bill contained an amendment offered by Virginia Foxx (R-NC) to strip all FY 2012 funding for USDA’s Know Your Farmer, Know Your Food Initiative (KYF2).  This was a misguided attack on an initiative that does not even have its own budget, but rather coordinates various programs and activities across multiple USDA agencies that work with farmers and ranchers producing for local and regional markets.  We are happy to report that the Conference Report does not include the Foxx amendment.

At the same time, however, it does retain some anti-KYF2 language that first showed up in the House agriculture appropriations report.  The Conference Report directs USDA to post on its website prior to any travel primarily related to KYF2, information including the agenda and the cost of such travel.  It also directs USDA to submit to Congress, within 90 days of enactment of the bill, a report on the impacts of KYF2 over the previous two years, as well as justification for spending on the initiative in the fiscal year 2013 budget explanatory notes.

As we reported when the House language was first released earlier this year, we are increasingly concerned about this ideologically driven and misguided attack on a growing and increasingly popular segment of American agriculture.

We hope that USDA goes one step beyond the new Conference Report requirement and also documents agendas and travel costs for all USDA travel primarily related to conventional national and multinational commodity markets as well.  Such a dual track reporting system would actually be quite educational!

Earlier Appropriations Actions

The House passed its agriculture appropriations bill in June of this year.  That bill included a $3 billion, or 14 percent, cut to discretionary spending for U.S. Department of Agriculture (USDA) and the Food and Drug Administration (FDA).  The House bill also included a $1 billion cut to mandatory conservation programs.

The Senate passed its agriculture appropriations bill in early September, proposing to cut $192 million from discretionary programs and taking roughly $742 million, or 12 percent, from farm bill mandatory conservation programs, on top of the half billion dollar cut contained in the FY 2011 agriculture appropriations bill.

Our previous reporting included full descriptions of the funding levels for conservation, rural development, credit, and research programs contained in the House bill and in the Senate bill.

After the Senate completed its bill, the House and Senate conferees were selected and the two sides went to work on a negotiated bill.  The Conference Report must now be sent back to both the House and Senate for a final vote before FY 2012 funding levels are set.

As the Senate and House Agriculture Committee leadership work to finalize their farm bill proposal for the Super Committee this week, NSAC and its allies will advocate for inclusion of the policy provisions in the Local Farms, Food, and Jobs Act into the farm bill.

On Thursday, November 3, NSAC and other farm and food organizations will host a Washington, D.C. fly-in for 50 farmers, ranchers, and other local and regional food advocates to voice support for the Local, Farms, Food, and Jobs Act.

The legislation helps farmers and ranchers by addressing production, aggregation, processing, marketing, and distribution needs to access growing local and regional food markets.  The bill also assists consumers by improving access to healthy food.  The measure provides secure farm bill funding for critically important programs that support family farms, expand new farming opportunities, create rural jobs, and invest in the local food and agriculture economy.

Co-sponsors of the bill at the time of introduction were Sens. Robert P. Casey (D-PA), Kirsten Gillibrand (D-NY), Tom Harkin (D-IA), Patrick Leahy (D-VT), Barbara A. Mikulski (D-MD), and Jon Tester (D-MT).

House co-sponsors include U.S. Reps. Earl Blumenauer (D-OR-3), David Cicilline (D-RI-1), Joe Courtney (D-CT-2), Peter DeFazio (D-OR-4), Keith Ellison (D-MN-5), Marcia Fudge (D-OH-11), Raul M. Grijalva (D-AZ-7), Janice Hahn (D-CA-36), Brian Higgins (D-NY-27), Rush Holt (D-NJ-12), Marcy Kaptur (D-OH-9), Ron Kind (D-WI-3), Dennis J. Kucinich (D-OH-10), Barbara Lee (D-CA-9), Ben Ray Lujan (D-NM-3), Ed Markey (D-MA-7), Jim McGovern (D-MA-3), Mike Michaud (D-ME-20), Gwen Moore (D-WI-4), Jim Moran (D-VA-8), Jerrold Nadler (D-NY-8), Eleanor Holmes Norton (D-DC-at large), John W. Olver (D-MA-1), Laura Richardson (D-CA-37), Gregorio Kilili Camacho Sablan (D-MP) Northern Mariana Islands, Jan Schakowsky (D-IL-9), Louise M. Slaughter (D-NY-28), Peter Welch (D-VT-at large), and Lynn Woolsey (D-CA-6).

Both the Senate and House bills are open for additional co-sponsors at any time.

Both Senator Brown and Representative Pingree issued press statements.

For more information on the bill and to take action, visit NSAC’s local food bill webpage.

For more information on a related bill backed by NSAC to gear the farm bill toward support for beginning farmers, go to our beginning farmer bill webpage.