Although it’s referred to as the farm bill, the $614 billion Farm, Nutrition and Bioenergy Act of 2007 that passed the House last week will affect more than just the agricultural industry.
“A big part is about nutrition,” said Todd Hice, director of the Rome and LaFayette offices of the USDA Farm Service Agency. “It’s got exports, trade, alternative energy; a lot more than just Farm Bureau concerns.”
The Senate is poised to take up its own version of the set of 10-year programs, which will replace the 2002 Farm Bill set to expire in September. A conference committee will then decide on the final provisions and the measure will go to President Bush.
Meanwhile, lobbying is continuing by groups as diverse as school lunch program advocates, textile mills, the automotive industry and biofuel producers.
Floyd farmers supportive
“The Georgia Farm Bureau is in favor of the bill passed by the House,” said Paul Smith, president of the Floyd County Farm Bureau and a former state representative. “Our local folks will be meeting in the coming week to go over it.”
The bill maintains most of the commodity crop subsidies in the current farm bill, but adds $1.6 billion for specialty crops such as fruits and vegetables, and expands their use in the food stamp and school lunch programs. Funding increases are scheduled for both nutritional programs, and organic farming also gets a boost in terms of production and marketing.
The bill also lowers the income eligibility limits to $1 million from $2.5 million for farmers collecting farm program payments, although the Bush Administration is demanding a cap of $200,000 in adjusted gross income.
A boost for Mount Vernon Mills
A new subsidy of 4 cents per pound of cotton processed by domestic cotton mills would
be a boon for Mount Vernon Mills in Trion, said Don Henderson, vice president of manufacturing.
Henderson said there’s a pound and a half of cotton in a pair of jeans and the mill runs more than 2 million pounds a week.
“It certainly is a big advantage for us to purchase cotton at somewhat of a discount over the rest of the world,” he said. “We don’t have many advantages left, and the Farm Bill could make us more viable long-term.”
Corn — as in corn starch — is another raw material vital to the mill, but the cost is rising as growers look toward turning it into ethanol instead. Henderson said the bill’s focus on encouraging the use of sugar and biomass from vegetation waste in alternative energy production is another plus.
“All of these things in one way or another are agricultural, and it affects us as individuals — in driving our cars or in the costs of the manufacturing process,” Henderson said. “We use so much energy as well as raw materials.”
Expansion of biofuels program
Greg Hopkins, president of Rome-based U.S. Biofuels Inc., said he’s pleased the bill includes an expansion of the Commodity Credit Corporation and Biodiesel Education programs.
The CCC provides farm subsidies that offset rising prices for domestic feedstock used in producing renewable fuels. Hopkins said the price of the soybean oil U.S. Biofuels uses has jumped 15 percent to 30 percent in the past year.
“Right now we’re in an unfavorable cost position because the oils and fats we use for making biodiesel have increased tremendously,” he said. “They’re being traded as energy now.”
But Hopkins also said he’s concerned a provision levying a new tax on foreign companies operating in the U.S. will stifle job creation — and he’s hoping it will be eliminated from the final version of the bill.
“They did something for our industry, but if this tax is imposed, it would be devastating to Rome,” he said.
Opponents count the costs
U.S. Rep. Phil Gingrey, R-Marietta, was one of the state Republicans backing the bill
until a late addition called for the tax on foreign-owned companies to partially pay for an $11.5 billion increase in food stamp and nutrition programs.
The American International Automotive Dealers Association and the U.S. Chamber of Commerce are among the groups that are strongly opposing the tax.
Gingrey said the estimated $7.5 billion levy would hurt companies, including Honda, Bekaert and Kia Motors, that are vital to the economy of Northwest Georgia.
“I would hate to think what our unemployment rate will look like if this tax increase drove these companies — and the thousands of jobs they create for our families and neighbors — out of Georgia,” he said. “I look forward to supporting a farm bill that ensures a safety net and sound future for our farmers but doesn’t pit agricultural jobs against manufacturing ones.”
In a July 26 letter to members of the House, U.S. Chamber of Commerce president R. Bruce Josten said the farm bill also “fails to achieve meaningful reform of our outdated agricultural policy (and) distorts international trade.”
Other provisions the Chamber of Commerce opposes include sugar price supports, an import tax on dairy products, country-of-origin labeling of meat products and a conservation fee on oil produced from deepwater leases on the Outer Continental Shelf and Alaska, Josten said.
