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March 16, 2001

Cochran requests emergency economic loss assistance

Calling financial stress in United States agriculture "extraordinary," Ag Appropriations Subcommittee Chairman Thad Cochran (R-MS) requested that the FY02 budget resolution include emergency economic loss assistance for farmers for 2001 and 2002, "or until such time as a replacement for the 1996 farm bill can be enacted." Cochran made the request in a letter to Senate Budget Committee Chairman Domenici (R-NM).

"Specifically," the letter stated, "since conditions are not appreciably improved for '01, we support making market loss assistance available so that the total amount of assistance... through the '01 Agriculture Market Transition Act (AMTA) payment and the market loss payment, will be the same as was available for the '00 crop.

"We understand it is unusual to ask that funds to be made available in the current fiscal year be provided in a budget resolution covering the next fiscal year, but the financial stress in US agriculture is extraordinary," the letter continued.

In an address to Mississippi Farm Bureau Federation in Washington, as reported by Cotton's Week, Cochran said, "while farmers and ranchers clearly prefer receiving their incomes from the market, federal assistance will be necessary until conditions improve as farmers strive to reduce costs and expand markets.

"In addition to financial assistance, we can also combat these financial difficulties by developing policies and programs to ensure a competitive agricultural economy, reduce trade barriers and open markets worldwide," he said.

He said emergency assistance would address problems in the short-term while allowing the House and Senate Agriculture committees time to develop a comprehensive new farm bill when current law expires in 2002.

Cochran said he favors continuation of the AMTA payment, adoption of additional income support programs to supplement payments to producers, retaining the current marketing loan and giving President Bush fast-track authority to help producers improve export opportunities.

Meanwhile, in his recent remarks to a joint session of Congress, President Bush said agricultural emergencies in the U.S. will qualify for part of the $1 trillion he wants to set aside over the next 10 years for times of crisis. The current budget does not mention special funding for farmers beyond that provided through existing support programs.

USDA Secretary Anne Veneman said the Administration's $19.4 billion level of discretionary spending for USDA in FY01 will be reduced for FY02. She said the FY01 mark was 13 percent over FY00, and that level "is in our view, unsustainable."

The proposed mark is $17.9 billion for FY02, and that restraint "does not require radical surgery," she said. "But this does mean we have to have a clear sense of our priorities."

Among reductions are about $1.1 billion in mostly one-time disaster funding that should not be needed this year, officials said. On the export side, Veneman explained that both the Market Access Program and the Export Enhancement Program are to be funded in the budget.

As for the administration's overall budget's tax proposals, Veneman stressed that farmers will benefit from elimination of the estate tax. The budget also proposes Federal Farm and Ranch Risk accounts that would allow farmers to save for another year when needs are greater.

Veneman said the budget also contained provisions to provide for emergency or "crisis" funding and stressed that USDA does have part of that emergency money set aside. However, she said the Administration doesn't know yet how much help farmers will need.

"We don't have a number at this point," she said. "We will be looking at what the need is, and we'll be working with...other parts of the administration and the Hill to determine the amount of emergency funding that will be needed."