Conrad, Hoeven Detail Foundation of New Farm Bill

Input from ND's Producers Was Key in Putting Together Plan, Senators say

Bismarck – Senators Kent Conrad and John Hoeven met with agricultural and agribusiness leaders from across North Dakota today to detail bipartisan legislation they crafted that will maintain a critical safety net for North Dakota farmers and serve as a major component of a new Farm Bill. 

"We are facing serious budget constraints that make the development of this new Farm Bill more challenging than anything we've seen in the past," Senator Conrad said.  "Senator Hoeven and I carefully crafted our legislation with the help of  North Dakota's producers. They told us that we need to maintain a strong crop insurance program. This legislation does just that while also contributing to deficit reduction." 

“Producers throughout our state have been telling us that good crop insurance is the foundation of a strong farm safety net and their number one priority,” Hoeven said. “That is just what we have worked to craft in this bipartisan legislation, which is the most cost-effective approach that will enable us to save money to help reduce the deficit, while providing our farmers and ranchers with strong support.” 

Joined by more than 40 state agriculture leaders, the Senators detailed the Revenue Loss Assistance and Crop Insurance Enhancement Act of 2012, legislation they based on feedback they received from North Dakota producers in a series of meetings over the past year that is less complex, more defensible, and a more effective safety net program for farmers.  

Senators Conrad and Hoeven  — both members of the Senate Agriculture Committee — are working to get their proposals incorporated into the new Farm Bill.  It creates the Revenue Loss Assistance Program (RLAP), an initiative that combines Supplemental Agricultural Disaster Assistance (SURE) and Average Crop Revenue Election (ACRE) into one simpler and more effective program.   

RLAP works in conjunction with crop insurance to provide farmers with assistance for losses between 12 and 25 percent of their average historic revenue.  An eligible loss can be due to any combination of decreased yields, declining prices or quality discounts.  RLAP is based on individual farm performance, rather than an area trigger, and assistance is provided on a commodity specific basis.   

RLAP is designed to address two of the primary shortcomings of the federal crop insurance: program deductibles that greatly exceed the operating margins for a crop and the lack of adequate coverage during multi-year price declines. 

RLAP provides assistance for farmers who suffered losses on acres planted for harvest at a 65 percent payment rate.  For acreage that was unable to be planted due to adverse weather, the payment rate is 45 percent. Total acreage covered under RLAP for a producer will not be able to exceed that producer’s total base acres.  

The legislation also establishes a Supplemental Coverage Option (SCO), along with other improvements to crop insurance.  SCO will allow producers to obtain area-wide federal crop insurance coverage in addition to the individual coverage they currently purchase.  

In addition, the new legislation extends the SURE Programs for crops for the 2012 crop year with a modification to expedite crop revenue loss payments by about one year.   

The new legislation also permanently extends the three livestock disaster programs and the Tree Assistance Program authorized in the 2008 Farm Bill. 

Finally, the legislation continues, with minor modifications, the current commodity marketing loan program and counter-cyclical program while ending the direct payment and Average Crop Revenue Election programs beginning with the 2013 crop.