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Senate Passes 2008 Farm Bill Conference Report

Thune Amendments and His Committee Contributions Make Bill Better for South Dakota

May 15, 2008

Washington, D.C. —  After months of gridlock and multiple temporary extensions, the United States Senate passed the 2008 Farm Bill Conference Report (H.R. 2419) by a veto-proof margin of 81 - 15. Senator John Thune, a member of the Senate Agriculture Committee, was instrumental in shaping many titles of the bill, which outlines our nation's agriculture policy through 2012.

Yesterday, the House of Representatives passed the final Farm Bill Conference Report by a similar veto-proof margin. The final Farm Bill will now be sent to the President for his consideration. The President will have 10 days to either approve or veto the Farm bill, not counting Sundays.

Today on the floor of the U.S. Senate shortly before the vote to overwhelmingly support the 2008 Farm Bill, Senator Thune voiced his strong support for the Bill and especially praised the Bill's Energy Title, which includes Thune's biofuels program that provides guaranteed funding to incentivize the growth and production of the cellulosic ethanol industry, and would expand ethanol production to all areas of South Dakota.

"South Dakota stands to reap substantial benefits thanks to the 2008 Farm Bill. Agriculture, weather disasters, outdoor recreation, and ethanol all significantly impact our state's economy, and as a member of the Senate Agriculture Committee I've worked hard to ensure this Farm Bill addresses specific needs and will work well for South Dakota," said Thune. "This bill makes great strides in providing disaster relief, advancing biofuels production, making adequate conservation tools available, and not just preserving, but improving the farm safety net."

The Senate Agriculture Committee has held 29 full committee hearings over the past 17 months on the Farm Bill reauthorization. Thune also Chaired the Ag Posse, a group of Senators who are not members of the Senate Ag Committee, but who represent states with agricultural interests. The Ag Posse provided these Senators the chance to meet informally with Senate Republican Agriculture Committee members to discuss the 2008 Farm Bill and related agriculture issues.

One of Thune's hardest-fought farm bill victories is the inclusion of a permanent disaster program. This battle for permanent disaster relief was made even more difficult during Conference Committee action because the House Farm Bill failed to include or address the need for permanent disaster provisions. The Permanent Disaster Title program will provide $3.8 billion in timely assistance to both crop and livestock producers for losses due to natural disasters. Senator Thune has fought tirelessly for ad hoc disaster programs for the past several years and recognized the absolute necessity of including a permanent disaster program in the 2008 Farm Bill. Eligibility for disaster assistance requires that a producer participate in crop insurance, which will strengthen the crop insurance program and encourage producers to better manage their risk.

"The 2008 Farm Bill eliminates the political games that have defined ad hoc disaster assistance in the past. South Dakota's farm and ranch families will now be able to receive timely disaster payments instead of waiting years for assistance," said Thune.

Senator Thune also hosted an Energy Subcommittee field hearing in Brookings, SD, in April, 2007 to explore the potential for expanding cellulosic ethanol production. Following the field hearing in Brookings, Senator Thune introduced a bill (S.36) the Biofuels Innovation Program, which was successfully included as a comprehensive biofuels provision in both the House and Senate-passed bills and now is included in the final Farm Bill Energy Title. Thune's legislation, with mandatory funding for "as much funds as are necessary," is a monumental victory for cellulosic ethanol and will jumpstart cellulosic ethanol production in South Dakota and nationwide.

"The Energy Title of this Farm Bill will result in even greater strides towards South Dakota's ethanol development, particularly cellulosic ethanol, and expand the potential to produce ethanol in South Dakota from border to border," said Thune.

A Thune safety-net provision amendment which preserves beneficial interest for farmers who would obtain loan deficiency payments when commodity prices drop was successfully passed during Senate Farm Bill markup and is included in the 2008 Farm Bill, with a modification to the pricing structure. Every major farm organization supported Thune's amendment and strongly supported his efforts to ensure this critical safety net provision was in the final Farm Bill.

Senator Thune's Farm Bill Priorities Retained in the 2008 Farm Bill Conference Report:
    Biofuels Innovation Program
    This Thune provision in the Farm Bill Energy Title would provide a cost-share payment and per-acre rental payment to producers who have committed to growing energy-dedicated crops for a local biorefinery. This program would also provide a per-ton payment to farmers for collecting, storing, and transporting biomass (such as corn cobs) to cellulosic ethanol plants. In total, this program will provide such sums as are necessary in mandatory funding to producers to jumpstart the cellulosic ethanol industry. Cellulosic ethanol production represents the next generation of renewable fuel production which could help to reduce our nation's dangerous dependence on foreign sources of oil.

    Permanent Disaster Title
    Senator Thune fought to include the Senate Farm Bill's permanent disaster program in the 2008 Farm Bill, which will provide timely assistance for losses due to natural disasters. The final Farm Bill establishes a trust fund totaling $3.8 billion over the next five years which will be used to timely provide disaster assistance when losses occur. The House-passed version of the Farm Bill failed to include a permanent disaster title despite its strong support within the agriculture community. The 2008 Farm Bill, with the Senate's permanent disaster program included will allow farmers and ranchers to plan for the future knowing the farm safety net has been strengthened.

    The Senate bill includes a reauthorization of the Conservation Reserve Program (CRP) with a 32 million acre cap. Several of Senator Thune's recommendations to strengthen and reauthorize the Wetlands Reserve Program and Grasslands Reserve Program were included in the Conservation Title. Overall, the Senate-passed bill includes more than $4 billion in additional funding for conservation programs that will benefit South Dakota's soil, water, and wildlife for years to come.

    Loan Deficiency Payments (LDPs)
    Senator Thune preserved a critical component of the Farm Bill family farm safety net. A Thune amendment, passed in the Senate Agriculture Committee, removed a potentially harmful requirement in the Committee's bill that would have negatively affected all grain producers by requiring that they sell their crop at the time of claiming an LDP, which provides a payment to producers in times of low commodity prices.

    Sun Grant Initiative
    The Final Farm bill reauthorizes the Sun Grant Initiative, which is coordinated by South Dakota State University. Thune has been working with members of the Senate Agriculture Committee to underscore the important renewable fuels research taking place at South Dakota State University and other Land Grant Universities across the country.

    Stronger Mandatory Country of Origin Labeling (COOL) Language
    Senator Thune requested that the House-passed COOL language be strengthened to clarify that all categories of red meat are required to be labeled. At Senator Thune's urging, the Senate Agriculture Committee corrected a potentially fatal flaw to the House-passed COOL provisions that will make implementing mandatory COOL clear, concise, and beyond legal challenge. Thune successfully convinced conferees to strengthen final COOL language in the Conference Report.

    Tighter Payment Limitations
    Although Senator Thune voted for even tighter payment limitations during debate of the Farm Bill, the final bill includes significant reform to focus farm payments to smaller family farms. Only producers with less than $500,000 in off-farm income or $750,000 in overall income would be eligible to receive direct payments. Maximum direct payments would remain at $40,000 per person and $80,000 per couple. The new income limit test does not apply for price supports, CCC grain loans and counter-cyclical payments, which are earned when grain prices drop below a certain threshold. Conservation payments are limited to individuals with adjusted gross incomes of $1 million or less, unless two-thirds of that income comes from agriculture or forestry. The final farm bill also prohibits payments from going to deceased farmers.

    Farm Service Agency (FSA) Office Closure
    Throughout the Farm Bill debate Senator Thune fought tirelessly to keep South Dakota's FSA County Offices open. In 2007, Senator Thune was the first member of Congress to introduce legislation to protect FSA offices from closure and specified that county offices could only be closed if FSA conducted an evaluation of cost savings at FSA headquarters. In March 2008, Senator Thune announced that the Campbell County FSA Office, which was scheduled to be shuttered, would remain open. On May 13, 2008, Senator Thune announced that as a result of his negotiations with FSA Headquarters, the remaining South Dakota offices on the closure list would also stay open. The 2008 Farm Bill includes a 2-year moratorium on the closure of FSA County Offices, with the exception of offices 20 miles or less from another FSA office. Senator Thune included language in the Conference Report which requires that FSA notify applicable members of Congress when future FSA county offices are scheduled to be closed. Additionally, as a result of Senator Thune's bill, the FSA is currently conducting a top-down evaluation of potential cost savings at its three national headquarters and state offices due to concerns that FSA was only targeting county offices for restructuring and cost savings.

    Native American Nutrition Tribal Assistance
    This Thune provision in the Farm Bill authorizes $5 million per year, for the life of the 2008 Farm Bill, for the purchase and distribution of traditional, locally-grown food produced by Native American farmers, ranchers and producers.

    Open Fields Legislation
    In May, Senator Thune joined a bipartisan group of Senators in cosponsoring the Open Fields Act. For the first time ever, federal mandatory funding ($10 million per year) will be available to expand the already successful walk-in program in South Dakota and in other states. South Dakota landowners voluntarily enroll more than 1 million acres of privately owned land in South Dakota's program every year.

    Ethanol Import Tariff
    The final Farm Bill also extends the 54-cent tariff on each gallon of imported ethanol. The import tariff, which offsets the domestic ethanol tax credit, is an important protection for both the growing domestic ethanol industry and the U.S. taxpayer. The new expiration for the tariff is January 1, 2011.