Vilsack expects temporary farm bill extension

HERSCHER, Ill. — The farm bill expired Sept. 30 and without an extension or new legislation, farm programs would revert back to laws passed about 80 years ago.

“A new farm bill or an extension of the current farm bill has to be done by Dec. 31 because if it’s not done then we have chaos. Right now, we have a number of smaller programs that are out of existence because it wasn’t extended on Sept. 30 when the farm bill expired,” Secretary of Agriculture Tom Vilsack said.

“We can get through the next couple of months, but if the farm bill hasn’t been extended Jan. 1, a lot of the farm programs will revert to what is called permanent law, laws that were passed in the 1930s and 1940s. What that will do is give me, the secretary of agriculture, discretion to determine the level of parity for most of the basic commodities and which farmers would benefit and which farmers would not.

“And you would have a very unusual circumstance that if a farmer had been fortunate enough to have acres allotted for wheat production, for example, in the 1940s, he or she would continue to get support. But if you’re a recent wheat producer, you wouldn’t get any support at all. It would be chaotic.”

Vilsack expects there will be an extension of the 2018 farm bill that was on the books until Sept. 30.

“I don’t know how long that extension is going to be, whether it’s a couple of months or six months or a year, but I think we’re going to see an extension,” he said.

“Once you get a House Speaker, the first order of business I suppose is a budget, and it’s not going to be easy to spend a lot of time on something other than that. There aren’t enough days in the calendar to actually debate a farm bill and get it through the House, get it through the Senate, get it to conference and get the conference report back through the House and Senate.

“I just don’t see it. There’s no agreement. If there was an agreement, you might be able to move it, but there’s not.”

In developing a new farm bill, Vilsack urged Congress to “think outside the box” with a broader view of multiple tools the government can use.

He gave an example of addressing reference prices updates for the Agricultural Risk Coverage and Price Loss Coverage programs that would have a price tag of $20 billion over 10 years.

“You can’t do reference prices, because there is not enough money in the existing farm bill to do that. And everybody up there knows that,” Vilsack said.

Farm groups are calling for higher reference prices — a factor in calculating subsidy payments — to offset high production expenses.

A 10% increase in reference prices would cost at least $20 billion over 10 years, said one farm policy expert, when the baseline for commodity supports is $62 billion.

“In order to solve the problem folks have addressed with the reference prices I think they have to think outside the box and I think the best opportunity is to utilize the Commodity Credit Corporation, because at the end of each fiscal year if you haven’t used the CCC monies, they’re gone. You can’t carry it over to the next year,” Vilsack said. “Every year we have anywhere from $7 billion to $10 billion to $15 billion that goes unused.

“It seems to me if reference prices are really that important and they need to be change, and you can’t find it within the existing farm bill programs, you’ve got to think outside the box.”