Senate plan would cap farmers at $125,000 a year in subsidies

decrease font size  Resize text   increase font size       Printer-friendly version of this article Printer-friendly version of this article

U.S. farmers would be limited to $125,000 a year in crop subsidies in a significant tightening of farm support rules proposed by four senators from farm and ranch states on Tuesday.

There is no effective limit on payments now. Large operators collect the lion's share of subsidies because they are based on each bushel of grain or pound of cotton grown on a farm.

"It's time to get the program back to its original intent," said Senator Chuck Grassley, an Iowa Republican and a sponsor of the bill who is a long-time proponent of strict limits. He said the farm program, dating from the 1930s, was aimed at protecting small and medium-size family farms.

Besides putting a "hard" cap on payments per farmer, the bill would crack down on payments to investors and absentee landlords. Under it, only one person living in town could collect subsidies for providing management on a given farm.

Passage of the package "would put an end to widespread abuse in farm programs," said the National Sustainable Agriculture Coalition, which represents small farmers. It said the chances for passage of a new farm bill would be boosted by the inclusion of meaningful payment limits.

Although the Senate included similar reforms in its farm bill last year, the version approved by the House Agriculture Committee rejected them. Both bills died at the end of 2012 so Congress must start over on the bill this year.

Grassley said he was confident the Senate would adopt the package this year. Senators Mike Enzi, an Wyoming Republican; Tim Johnson, a South Dakota Democrat; and Sherrod Brown, an Ohio Democrat, joined Grassley as sponsors. Brown and Grassley are members of the Senate Agriculture Committee.

PAYMENT LIMITS ARE FIGHTING WORDS IN CONGRESS

The senators proposal would allow grain, cotton and soybean growers to collect up to $50,000 a year for all crop subsidies and $75,000 annually from the marketing loan program, for a total of $125,000 per farmer. The total would double to $250,000 for a married couple.

At present, there is a $105,000 limit per farmer, or $210,000 per couple, on crop subsidies and no limit on marketing loan benefits, so there is no overall limit on payments.

The senators said a stricter definition of who qualifies for subsidies, known as the "actively engaged" rule, would greatly reduce the flow of subsidies to investors and absentee owners who take no role in running a farm but who say they provide key management direction.

Farm subsidies are available to people who provide land, equipment or capital and 1,000 hours of labor per year or active management. A decade ago, a congressional commission suggested more stringent rules on what qualifies as management.

"For too long farm program payments have gone to producers who do not need the support -- and sometimes to people who are not involved in farming," said Brown.

The 2008 farm law was the first to deny subsidies to the wealthiest farmers, or those with more than $1.25 million in adjusted gross income. It also ended the "three-entity rule" that allowed growers to collect subsidies directly and through two affiliates.

Payment limits are a perennially divisive issue in U.S. agriculture, pitting cotton and rice growers in the South against the wheat, corn and soybean farmers of the Plains and Midwest, and big operators against small farmers. Cotton and rice have the highest support rates but also high costs of production. (Reporting By Charles Abbott; Editing by Leslie Adler)


Buyers Guide

Doyle Equipment Manufacturing Co.
Doyle Equipment Manufacturing prides themselves as being “The King of the Rotary’s” with their Direct Drive Rotary Blend Systems. With numerous setup possibilities and sizes, ranging from a  more...
A.J. Sackett Sons & Company
Sackett Blend Towers feature the H.I.M, High Intensity Mixer, the next generation of blending and coating technology which supports Precision Fertilizer Blending®. Its unique design allows  more...
R&R Manufacturing Inc.
The R&R Minuteman Blend System is the original proven performer. Fast, precise blending with a compact foot print. Significantly lower horsepower requirement. Low inload height with large  more...
Junge Control Inc.
Junge Control Inc. creates state-of-the-art product blending and measuring solutions that allow you to totally maximize operating efficiency with amazing accuracy and repeatability, superior  more...
Yargus Manufacturing
The flagship blending system for the Layco product line is the fully automated Layco DW System™. The advanced technology of the Layco DW (Declining Weight) system results in a blending  more...
Yargus Manufacturing
The LAYCOTE™ Automated Coating System provides a new level of coating accuracy for a stand-alone coating system or for coating (impregnating) in an automated blending system. The unique  more...
John Deere
The DN345 Drawn Dry Spreader can carry more than 12 tons of fertilizer and 17.5 tons of lime. Designed to operate at field speeds up to 20 MPH with full loads and the G4 spreader uniformly  more...
Force Unlimited
The Pro-Force is a multi-purpose spreader with a wider apron and steeper sides. Our Pro-Force has the most aggressive 30” spinner on the market, and is capable of spreading higher rates of  more...
BBI Spreaders
MagnaSpread 2 & MagnaSpread 3 — With BBI’s patented multi-bin technology, these spreaders operate multiple hoppers guided by independent, variable-rate technology. These models are built on  more...


Comments (2) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left

John    
Montana  |  February, 13, 2013 at 11:13 AM

Wow, commen sense and responsibility, from Congress! What a novel concept.

Bill    
North Carolina  |  February, 14, 2013 at 09:25 AM

and no southerners involved! Just might have a chance.


Fertilizer Conveying Systems

Waconia Manufacturing routinely designs receiving systems for volume requirements from 60 to 1,500 TPH. All receiving systems are fabricated with ... Read More

View all Products in this segment

View All Buyers Guides

Feedback Form
Feedback Form