Farm Budget Secures Share of $500 Billion Strategic Reserve
House-passed budget resolution aids agriculture this year and next 10 years
March 28, 2001
The U.S. House of Representatives Wednesday afternoon approved a ten-year budget resolution that Agriculture Committee Chairman Larry Combest (R-Texas) said will set the course for predictable support to the agricultural community based on sound policy. The budget allows for the reform of the commodity title of the current Freedom to Farm policy to give farmers needed predictability in farm income support, as opposed to continued ad hoc disaster assistance. The budget also reserves funding in the current 2001 fiscal year in anticipation of lost income from high fuel and fertilizer costs and forecasts of continued depressed commodity prices.
Agriculture, as well as defense, is named in the budget plan as eligible for access to the $514 billion Strategic Reserve Fund from fiscal years 2002-2011. By summer, the Agriculture Committee will present a long-range commodity program based on the consensus of farm groups’ specific plans that will determine the budget needs recommended by the Agriculture Committee. Current crop year needs will be allocated from the fiscal year 2001 reserve fund of $90 billion.
"As it should have, Congress has stepped in with emergency economic assistance in each of the last three years, and many farmers are still in business today because of that help. But the need continues. It is time to stop ad hoc assistance and move to a more permanent solution that producers, their bankers and their suppliers can count on. And this can be done in a way that provides more fiscal discipline that will benefit the taxpayer while providing more predictable support to the agricultural community," said Agriculture Chairman Combest during the budget debate.
The budget plan also anticipates elimination of the estate tax with Thursday’s vote in the House, which will make it easier for farmers to pass on their farms to the next generation. The budget also leaves room for additional tax reform, such as expanded income averaging provisions and creation of Farm And Ranch Risk Management (FARRM) savings accounts.