Crop Insurance Reform: Agricultural Risk Protection Act (HR 2559): 
passed the House 422-1 and signed June 20, 2000 (PL 106-224)
This legislation provides $8.1 billion for reforming the federal crop insurance program.  This is the most sweeping improvement to the Federal Crop Insurance Act in the program’s 62-year history.

• Provides producers new and better tools to manage both production and market risks inherent to farming by providing more comprehensive insurance coverage for more crops at a better price.

• Provides incentives for the development of new and innovative products for crops and livestock.

• Provides special incentives for developing products for commodities that are considered to be underserved.

• Provides strong authorities to combat waste, fraud and abuse to protect the interest of program participants and taxpayers.

Economic Assistance for Producers
In the midst of extremely low commodity prices for all commodities and increasing production prices, Congress has provided a total of $25.6 billion in supplemental agricultural assistance for 1998 through 2000.  In 1998, Congress approved $6.1 billion; in 1999, Congress approved $9.1 billion; and assistance for 2000 totals $10.6 billion - $7.1 billion included in the Agricultural Risk Protection Act and $3.5 billion in the FY 01 Ag Appropriations bill.  Key provisions of the emergency assistance include:

• $14.763 billion in Market Loss Assistance payments between 1998 and 2000

• $5.175 billion in Crop Loss Disaster Assistance in 1998-2000

• $755 million for Specialty Crops including tobacco and peanuts from 1999-2000

• $960 million in Livestock Assistance in 1998-2000

• $795 million in Dairy Assistance between 1998-2000; FY 01 Ag Appropriations extended the dairy price support program through Dec. 31, 2001. 

Producers' Trade Concerns
Trade is an essential part of producers’ livelihoods -- American exports to other nations currently account for 30% of U.S. farm cash receipts.  Nearly 40% of all agricultural production is exported. 
The following measures greatly affect producers (also see MORE on Agricultural Trade): 

• Permanent Normal Trade Relations for China – On October 10, 2000, the president signed this measure into law.  This measure will lower trade barriers to provide U.S. farmers better access to a market of 1.2 billion people.  U.S. agriculture can expect a $2 billion per year increase in exports by the time the agreement is fully implemented in 2005.

• Carousel Retaliation Lists – On May 18, 2000, the president signed the Trade and Development Act of 2000, which included a provision for periodic revision of WTO approved retaliation lists, better knows as the carousel laws.  This law adds teeth to our retaliatory tactics by requiring the USTR to periodically revise the list of goods subject to retaliation when a foreign country fails to comply with a WTO ruling.

• Caribbean Basin Initiative – Another provision of the Trade and Development Act of 2000 is the CBI, which removes duties and quotas on certain Caribbean apparel exports made from U.S. textile components.  Encourages U.S. firms to combine U.S. cotton yarn and/or fabric with further processing in the Caribbean.  Increases use of U.S. cotton, which helps U.S. cotton producers.

• Lifting the ban on food and medicine exports - The FY 01 Ag Appropriations bill included a provision eliminating unilateral food (including agriculture products such as cotton) and medicine sanctions on Libya, Iran, North Korea, Sudan, and Cuba.   It also sets up a process requiring Congressional review before future unilateral sanctions for food and medicine can be imposed.

Taxes Affecting Producers

• HR 8, the Death Tax Elimination Act of 2000 – passed by Congress but was vetoed by President Clinton.

• HR 4810, the Marriage Tax Relief Bill – passed by Congress but was vetoed by President Clinton.

• Congress passed tax relief measures beneficial to America’s producers during the previous 105th Session of Congress, such as allowing phased-in deductions self-employed persons may take for health insurance increasing from 60% for tax years 1999-2001; 70% for 2002; to 100% beginning in 2003; Allowing permanent income averaging for farmers; Reducing all capital gains rates.

• The House passed legislation on October 26, 2000, including a provision for Farm, Fish and Ranch Risk Management Accounts that allows producers to save up to 20% of their taxable income each year in a tax-free reserve account and remain there for 5 years.

• TMDLs – A TMDL is the Total Maximum Daily Load of soil and particles carried in water. 

On July 11, EPA finalized a rule on TMDLs that was not scientifically based and could 
drastically affect the actions of producers when cultivating land.  Congress passed legislation to prohibit EPA from implementing its TMDL rule until October 1, 2001.

• Kyoto Protocol – Congress included a provision in the FY 01 Ag Appropriations prohibiting the use of funds for activities under the Kyoto Protocol, a treaty President Clinton has not submitted to the Senate for approval.  Experts indicate that submission to the protocol puts American farmers at a severe disadvantage to foreign competitors like China and Brazil who would be exempt because of their “developing country” status.

Plant Protection Act (HR 1504) Title IV of Agricultural Risk Protection Act (PL 106-224):
Consolidates and updates various outmoded plant quarantine laws to safeguard America’s abundant plant resources from invasive plant pests.  The law consolidates 11 previous plant quarantine laws that date back to 1913 and which comprise a patchwork of sometimes confusing and inadequate authorities that simply did not work for our current modes of trade and transportation. 

Biomass Research Development Act (S 935) Title III of Agricultural Risk Protection Act (PL 106-224)
Biomass products can be derived from plants, crop residues, wastes, and other organic sources.   Organic waste products once deemed worthless have the potential to become valuable commodities like plastics and fuel.  Byproducts such as corncobs, sugar cane stalks, and rice hulls could create power and cleaner air.  The Act authorizes $49 million within USDA for each of fiscal years 2000 – 2005 for the Biomass Research and Development Initiative, which provides competitively awarded grants, contracts and financial assistance to eligible entities to carry out research and development of low cost and sustainable biobased energy and industrial products.

Freedom to E-File Act (HR 852/S 777):
passed the House 397-1 and signed June 20, 2000 (PL 106-222)
As advanced technology and the Internet are becoming increasingly common and important tools for farmers and ranchers, they will now have the convenience of filing paperwork online, which will ease paperwork burdens and streamline the process at USDA.

Electronic Benefit Transfer Interoperability and Portability Act of 2000 (S 1733/HR 2709): 
signed February 11, 2000 (PL 106-171)
This law provides a national standard of interoperability and portability between states for the food stamp program.  The Food Stamp Act already requires that all states issue food stamp benefits under an EBT system by 2002.  EBT is a more efficient and effective manner in which to provide food benefits for needy families.

County Schools Funding Revitalization Act (HR 2389): 
signed October 30, 2000 (Public Law number is pending)
Because the Forest Service is the dominant landowner in many rural communities, and localities are powerless to tax the agency, the government has shared 25% of the revenue derived from national forest activities with the surrounding localities to finance schools and local roads.  Recently, federal forest revenues have plummeted due to restricted land use policies by the Clinton Administration and payments have dropped.  This measure provides new sources of revenue to increase payments to struggling communities by 61%, or more than $145 million annually.

Grain Standards and Warehouse Improvement Act of 2000 (HR 4788): 
This measure has passed Congress.  The president is expected to sign this measure into law.
The reauthorization of the U.S. Grain Standards Act will provide the Grain Inspection Packers and Stockyards Administration with the essential authority to continue the inspection of grain, both domestically and internationally. A rewrite of the U.S. Warehouse Act authorizes electronic warehouse receipts for commodities other than cotton. 
Other provisions include:

• Small Watershed Rehabilitation Amendments (HR 728):  More than 10,000 small flood prevention dams have provided conservation and economic benefits to much of rural America and are in need of rehabilitation.  This measure helps small communities raise the financial resources to repair the dams by providing grants and cost-share assistance.

• International Food Relief Partnership Act (HR 5224):  This Act would authorize grants to private, non-profit organizations and private voluntary organizations for the stockpiling and rapid transportation, delivery, and distribution of shelf stable prepackaged foods to needy individuals in foreign countries.  The Act will provide these organizations additional tools in their goals of utilizing the generosity of America's farmers and ranchers in feeding hungry all over the world.

Commodity Futures Modernization Act of 2000 (HR 4541): 
This measure passed the House by a vote of 377-4 and is awaiting further action.
This measure revamps U.S. futures laws to make them more conducive to the modern finance industry; makes our domestic exchanges more competitive in the changing international markets; and provides legal certainty for risk management tools that have become so important to financial institutions worldwide. 

• Provides regulatory relief for the U.S. futures exchanges and their markets;
• Provides legal certainty for the $90 trillion over-the-counter (OTC) derivatives markets; and
• Reforms the Shad-Johnson accord to allow the sale of futures on U.S. securities on U.S. exchanges.

Launching Our Communities’ Access to Local Television Act (S 2097): 
This measure was included in the Commerce-Justice-State Appropriations conference report, which passed Congress and is awaiting further action. 
This legislation ensures that communities will no longer be denied access to local news, weather and emergency information by extending loan guarantees to companies willing to provide rural communities with access to local television via satellite.

Farm Bill
The House Agriculture Committee has begun the process of rewriting our current farm bill, which expires in 2002, by holding 10 field hearings across the country and 5 in Washington to hear from farmers and policy experts on the proper role of government for the future of U.S. agriculture.