Row-crop farmers would be able to collect up to $155,000 a year in crop subsidies, a $30,000 increase from the current limit, under the farm bill written by House Republicans and scheduled for a committee vote on Thursday. And, for the first time, the subsidy ceiling, often a lightning rod for reformers, would be adjusted annually for inflation.
The so-called payment limit would rise, and USDA spending on crop supports and crop insurance would also rise by roughly one-third, or as much as $53 billion over 10 years, according to Republican staff workers. The GOP bill would cut SNAP by $27 billion and allow $15 billion in climate funding to be spent on any conservation practice whether or not it reduced greenhouse gases or captured carbon.
Senate Agriculture chairwoman Debbie Stabenow declared herself a “Proud ‘hunger weirdo'” on social media for opposing the SNAP cut. A day earlier, a House Republican staffer said groups opposing the cut were “hunger weirdos” who “use poor people as props” while fomenting hysteria against the five-year legislation.
Georgia Rep. David Scott, the senior Democrat on the House Agriculture Committee, was skeptical that the GOP’s mechanism to pay for larger farm supports by severely restricting USDA access to a $30 billion reserve, would withstand scrutiny. The proposal “does a disservice to American agriculture because it doesn’t provide a path forward to getting a bill passed on the floor,” said Scott.
In a statement, Agriculture chairman Glenn Thompson said his draft of the farm bill “is the product of extensive feedback from stakeholders and all members of the House and is responsive to the needs of farm country through the incorporation of hundreds of bipartisan policies.”
The GOP package included items that could appear in a farm-group wish list. Along with higher statutory reference prices — up 10-20 percent in the GOP package — the bill increases payment limits, offers a one-time update of the number of “base” acres eligible for crop subsidies, raises marketing loan rates, requires schools to serve whole milk, overrides California’s Proposition 12 animal welfare law, and offers USDA financial assistance to farmers to purchase equipment or software for precision agriculture, such as GPS guidance.
House GOP staffers briefly mentioned the subsidy ceiling revisions and the inauguration of indexing during a fast-paced review of their farm bill last week, saying it was a modernization of payment limit rules. The statutory language, Section 1604, runs one page of the bill.
Payment limits are a routine headache during farm bill drafting. There are attempts to loosen the rules as well as proposals to tighten the standards. The 2018 farm law tightened the rules somewhat by saying that an individual must perform at least 500 hours or at least 25 percent of the management of a farm to collect a payment. The 2018 law also made first cousins, nieces, and nephews eligible for crop supports as family members.
At present, the subsidy ceiling is set at $125,000 a year per person. Spouses are automatically eligible, so the limit for a married couple is $250,000.
Congress has tried repeatedly since 1987 to restrict access to crop subsidies, but there are many ways to evade the rules. Payments are available to people who are “actively engaged” in agriculture by providing land, equipment, or capital to an operation and who perform labor or management as well. The Government Accountability Office, a congressional agency, says a farming operation received $651,000 in subsidies in 2012 with 16 of its 22 members claiming eligibility as managers.
For all the attention to payment limits, the bulk of USDA payments during the Sino-U.S. trade war and the pandemic flowed through stopgap programs, created chiefly by the Trump administration, with maximum payments that were double, or higher, the crop subsidy ceiling. Thompson would use those huge outflows — $64 billion in six years, according to a House staffer — to his advantage in his bill. He would close the door to such expenditures and use the savings to pay for his farm bill initiatives; an unusual budgeting approach.
The House GOP bill also would eliminate any tolerance for erroneous SNAP payments; the USDA tracks over- and under-payment of benefits, which surged during the pandemic. “An error is an error and states should receive no grace,” said a GOP summary. The bill also would create a pilot program for food boxes “to supplement, not supplant, the nutrition of food-insecure households in a manner complementary” to USDA programs but run by community and faith-based groups. The Trump administration was thwarted in a proposal to use food boxes to replace a portion of SNAP benefits but later used the approach as a response to hunger during the pandemic.
An Agriculture Committee summary of Thompson’s bill is available here.
The text of the 942-page bill is available here.
A USDA fact sheet on payment eligibility and limits is available here.