It was a close shave on Capitol Hill this week. Crop insurance was being cut in the new budget agreement, but managed to hang on by a whisker.
Texas Farm Bureau heard rumors Monday night that the new budget agreement would include cuts to the federal crop insurance programs. The deal, released Tuesday, extended the debt limit and increased annual spending limits. The bill was fast tracked to be heard on the House floor on Wednesday.
The proposed bill increased spending limits for two years: $50 billion for FY 2016 and $30 billion for FY 2017, to be equally divided between defense and non-defense programs. The bill is deficit neutral because the increase in spending is offset by cuts and changes to mandatory programs—including crop insurance.
The original bill takes $3 billion from the private sector delivery system for crop insurance by capping a rate of return at 8.9 percent. The current cap authorized in the Farm Bill is at 14 percent. The language also requires a new Standard Reinsurance Agreement by the end of 2016.
All of agriculture agrees that crop insurance is critical to preserving the safety net that keeps farmers on the land.
Texas Farm Bureau President Russell Boening said this about the situation: “Crop insurance is critical to the vast majority of farmers. Without affordable risk management, a drought like we experienced in 2011 could have spelled the end for many farms and ranches across Texas. When farmers hurt, the rural economy hurts, too.”
Response to proposed budget agreement
Texas Farm Bureau, the American Farm Bureau Federation and other agriculture organizations reacted strongly in opposing the cuts to the Farm Bill. AFBF asked State Farm Bureaus to call their House and Senate offices that day to voice opposition to this language. TFB staff contacted our legislators and emailed the entire Texas delegation a letter voicing our opposition to the proposed cuts. TFB President Russell Boening was interviewed on the TFB Radio Network, explaining the importance of crop insurance and why we need to oppose these cuts.
House Agriculture Committee Chairman Mike Conaway (R-Texas), Senate Agriculture Committee Chairman Pat Roberts (R-Kan.) and Ranking Members Sen. Debbie Stabenow (D-Mich.) and Rep. Collin Peterson (D-Minn.) issued a joint statement opposing the budget deal as long as it included the cuts to crop insurance.
“Make no mistake; this is not about saving money. It is about eliminating Federal Crop Insurance,” said Chairman Conaway.
Many congressional members signed on to a letter opposing the crop insurance cuts. Congressman Pete Sessions (R-Texas), chairman of the Rules Committee, helped by asking for more information before letting the bill pass the Rules Committee.
Crop insurance won’t be cut
After the strong response opposing crop insurance cuts, the leadership agreed to not open the farm bill and to leave crop insurance alone. The budget agreement passed Wednesday by a vote of 266 to 167. The language cutting $3 billion from crop insurance is still included in this bill, but the leadership has promised to take it out when passing the omnibus budget bill.
The Senate has agreed to the same promise with regard to crop insurance.
A vote is pending as we write this report.
This is a great win for agriculture, but our work is not completed. We must hold them to their promise that this offending language is removed.
Texas Farm Bureau will continue to update you as we move forward.