NCC appreciates SAC Chairman for developing a balanced reconciliation package
20 Oct '05
4 min read
In preparing for the writing of the 2007 farm bill, the Committee bill also preserves budgetary resources, known as the 'baseline,' for the upcoming farm bill debate by generally suspending spending reductions in fiscal year 2011.
The Congressional Budget Office estimates that the Committee's bill reduces outlays for mandatory programs under the Committee's jurisdiction by $196 million in fiscal year 2006 and $3.014 billion over the next five years covering fiscal years 2006 through 2010. By achieving the savings required by the budget resolution, the Committee's action can not be changed by the Budget Committee as it develops the omnibus legislation to be considered by the Senate. However, the package can be amended on the floor.
The major provisions of the Committee package include a reduction by 2.5 percent in all payments that producers receive in Direct Payments, Counter-Cyclical Payments, and Marketing Loan Gains or Loan Deficiency Payments for the 2006-10 crops. In addition, the package calls for the termination of the Step 2 program for upland cotton on August 1, 2006. To achieve balance across the farm bill, spending reductions are also included for dairy, sugar, conservation and research programs.
Regarding the elimination of Step 2, Eastland reiterated earlier statements that terminating the program prior to the conclusion of the current farm bill is an acknowledgement of US international obligations. He noted again that, 'A decision to completely terminate a US farm program in the middle of a farm bill is virtually unprecedented. The loss of the Step 2 program will reduce offtake of US cotton and put additional pressure on prices received by farmers.'
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