As the ag economy remains in flux, uncertainty lingers on whether Congress will pass a new farm bill or extend the current version of the bill for another year.
The House Ag Committee passed a new farm bill last spring by a 33-21 vote. The bill increases support for the price loss coverage and agriculture risk coverage programs. The House bill also increases guaranteed U.S. Department of Agriculture operating loan limits to $3 million and guaranteed ownership loans to $3.5 million while providing resources to new, beginning, and veteran farmers to ease the transition of farms. The bill would increase premium assistance for beginning and veteran farmers and expand premium discounts for veteran and beginning farmers for the first decade of farming.
The bill still needs to pass through the full House of Representatives and Senate before being sent to a conference committee. Failing to pass a farm bill could lead to another extension of the current version of the bill, which was first passed in 2018 and expired on Sept. 30.
Testifying this summer before the House Ag Committee, Minnesota Corn Growers Association President Dana Allen-Tully said farmers face “a perfect storm” early next year and will have trouble securing the necessary cash flow for loans without an updated farm bill.
A new farm bill would provide a safety net for farmers during the downturn in the ag economy, said Ed Elfmann, senior vice president of agricultural and rural banking policy at the American Bankers Association. He expects Congress will extend the current bill while working on a five-year bill. Lawmakers are also considering pairing the extension with other forms of farmer relief.
The current farm bill will either be extended, or new legislation will pass during the lame duck session of Congress, said Mark Scanlan, SVP of agriculture and rural policy at the Independent Community Bankers of America. He supports a new five-year farm bill to enable bankers to undertake longer-term planning with customers.
In September, Sen. John Hoeven (R-N.D.), a ranking member of the Senate Ag Appropriations Committee, said Congress must pass a farm bill to help farmers navigate low commodity prices and high input expenses. Still, partisan divisions complicate the odds of passing a new farm bill. Republicans and Democrats differ on how to pay for larger subsidies to large commercial growers and proposed limits on the federal government’s ability to raise money for food aid.
In July, anti-ESG group Consumers’ Research penned a letter to top ag lawmakers calling on policymakers to neither include mandatory climate disclosures nor require fertilizers to pledge to reduce crop yields. Democrats say the bill passed by the House Ag Committee would include the largest cut to the Supplemental Nutrition Assistance Program in nearly three decades while rescinding funds for environmentally-friendly agriculture practices.
Congress is also working on other ag-related bills. The Access to Credit for our Rural Economy Act includes a tax exemption for single-family home mortgages in rural communities with fewer than 2,500 residents and for mortgages of less than $750,000. The House version of the bill has 70 cosponsors, with at least 18 Democrats on board.