Estate Taxes To End?
By Roy C Ferguson II, CMC/CAC
According to an ASFMRA bulletin on July 16th, legislation to end IRS collection of Estate Taxes has been introduced jointly by South Dakota’s Republican Senator along with Democrat and Republican House members from North Carolina and Texas. The proposed legislation is entitled the Death Tax Repeal Act of 2013.
The American Farm Bureau Federation was quick to endorse the proposed bipartisan legislation. Other agriculturally oriented organizations will hopefully lend their active support.
Even though significant tax relief was enacted during 2012 to assist farmers and ranchers cope with their future estate taxes, the Farm Bureau reportedly believes that complete, permanent repeal of all estate tax provisions is by far the best solution to protect all farms and ranches.
The newly proposed Death Tax Repeal Act of 2013 includes repealing the estate tax completely…maintaining stepped-up basis and making permanent a 35% maximum gift tax rate…plus providing a $5 million lifetime gift tax exemption indexed for inflation. Contrary to general perception, individuals, family partnerships, and family corporations own an overwhelming 98% of the nation’s two million plus farms and ranches.
Numerous examples have been recorded in which estate taxes levied on agricultural operations have exceeded Cash and Other Liquid Assets. Surviving family partners have consequently been forced to sell land, buildings, or equipment which are vitally needed to keep the agricultural business operating as a viable unit. As an inevitable result, farming and ranching operations are not only handicapped severely, but rural communities and businesses that agriculture supports are also injured financially.
The value of the vast majority of U.S. farms and ranches is commonly tied to Illiquid Assets such as land, buildings, machinery, and equipment. Thus, with approximately 85% of a typical farm’s or ranch’s Total Assets being illiquid, producers have few options when it comes to generating enough Cash to pay substantial estate taxes.
Adding to the inherent problem, recent years’ escalation of agricultural cropland’s Fair Market Values has expanded dramatically the number of farms and ranches that now exceed the existing estate tax exemption. Considering the fact that the Obama Administration is committed to boosting virtually all tax rates considerably higher, Estate Taxes will almost certainly become even more burdensome unless some legislation at least similar to the Death Tax Repeal Act of 2013 is passed by Congress. Even then, prospects of a Presidential Veto remain substantial. From The Ferguson Ag Report, Copyright 2013.
Senate Names Farm Bill Conferees – House Does Not
By Stephen Frerichs
The Senate officially named its conferees for the farm bill last week. The House has not and is not likely to do so until it votes on a “nutrition bill” in September (see below).
The Senate conferees are: Democrats: Senate Agriculture Chairwoman Debbie Stabenow (D-MI.) and Senators Patrick Leahy (D-VT), Tom Harkin (D-IA), Max Baucus (D-MT), Sherrod Brown (D-OH), Amy Klobuchar (D-MN.) and Michael Bennet (D-CO.) Republicans: Ranking Member Thad Cochran (R-MS.) and Senators Pat Roberts (R-KS), Saxby Chambliss (R-GA.), John Boozman (R-AR.), and John Hoeven (R-ND)
House to Vote on “Nutrition” Bill in September
By Stephen Frerichs
A group of House Republicans led by Majority Leader Cantor (R-VA) has developed a framework for a “nutrition bill”. Recall the House passed a farm bill in July that did not include a nutrition title. The current plan is to bring up a bill in September to cover the nutrition programs. The Senate passed farm bill does include a nutrition title, with roughly $4 billion in savings over 10 years.
Details of the House proposal were not released before Congress began its 5 week recess period. Press reports the plan would save over $40 billion over ten years (double the House Agriculture Committee target and 4 times larger than the Senate target) and include the provisions that were adopted on the House floor when it considered the farm bill with the nutrition title.
Ranking member Peterson was swift to decry this effort in a press statement. He said in the statement: “Adding an additional $20 billion in nutrition cuts, on top of the poison pill nutrition amendments that brought down the Agriculture Committee’s bipartisan farm bill in June, effectively kills any hopes of passing a five-year farm bill this year.”
Clearly this approach is a partisan effort as few, if any, Democrats would vote for it. It also means little work will likely occur in August on a farm bill conference agreement among House and Senate staff. Until the nutrition conundrum is resolved, not much can be done.
By Stephen Frerichs
The Senate confirmed Krysta Harden as the new Deputy Secretary of Agriculture and Robert Bonnie as the new USDA Under-Secretary for Natural Resources and the Environment last week.
Harden previously served as Chief of Staff to Secretary Tom Vilsack. She has also been Assistant Secretary for Congressional Relations, the Executive Director with the National Association of Conservation Districts, and held posts at the American Soybean Association, and the House Agriculture Committee, among others. Bonnie has been Vilsack’s Senior Environment and Climate Adviser, and previously directed the Center for Conservation Incentives at Environmental Defense Fund.
Jason Weller was also named the Chief of the Natural Resource Conservation Service. He had been serving as acting Chief since the departure of Chief White.
USDA Releases Land Value Report
By Stephen Frerichs
The National Agricultural Statistics Service (NASS) released its annual report about land values. You can find the report here: http://usda01.library.cornell.edu/usda/nass/AgriLandVa//2010s/2013/AgriLandVa-08-02-2013.pdf
Conservation Programs Slashed Under House Appropriations Bill
By Bill Garber
On July 31, the House Appropriations Committee delayed a final vote, until after the August recess, on a bill that would slash FY 2014 funding for Department of Interior and Department of Agriculture conservation related programs. Under the draft FY 2014 appropriations bill, Interior’s Land and Water Conservation Fund, and Agriculture’s Forest Legacy, as well as five other conservation programs would receive zero funding. The Land and Water Conservation Fund and the Forest Legacy program are two of the largest federal conservation programs supported by real estate appraisals.
Overall, the House bill, as proposed, would provide $5.5 billion, or 19 percent, less than the fiscal 2013 enacted level for all agencies covered under the measure. The measure would be $4 billion less than the current spending level after accounting for sequestration cuts and provide $5.7, or 19 percent less than President’s budget request.
The House Appropriations Committee worked through about a dozen amendments, including one that would provide $20 million for the Land and Water Conservation Fund offset by funds from the Forest Service capital improvement program, before adjourning for the August recess.
Rep. Mike Simpson, R-ID, Chairman of the Interior and Environment Subcommittee said he didn’t like aspects of the bill that would make cuts like zeroing-out funding for the Land and Water Conservation Fund and other programs, but pointed to the country’s budget deficit. He said the bill aimed to differentiate between “must-do” priorities from others.
The Committee is expected to resume work on the measure in September.
Our Director of Education, Mark Grace, has submitted his resignation. “I have decided it is time for me to make some changes in my life”, he told our staff. Mark wanted staff members, The Executive Council and Committees and Members he has worked with to know that it has been a pleasure to work with everyone and he is proud to have been associated with such a dedicated group of people. Mark’s last day will be Friday, August 9th. He will be working to finalize as many projects as he can during his remaining time here. He thanks everyone for all for all the support given him over these last 4.5 years.
Senate bill would protect producers’ personal information
By Carol Ryan Dumas – Capital Press
Sens. Charles Grassley, R-Iowa, and Joe Donnelly, D-Ind., have introduced legislation that would prevent the Environmental Protection Agency from releasing livestock and poultry producers’ personal information — such as names, phone numbers, e-mail addresses, physical location, and GPS coordinates. The bill, S.1343, stems from EPA’s release of personal information of more than 80,000 livestock and poultry producers, their families and employees in February. The release was in response to FOIA requests from the National Defense Council, Earth Justice and the Pew Charitable Foundation. S. 1343, the Farmer Identity Protection Act, prohibits EPA from releasing that personal information without a producer’s consent unless it has been transformed into a statistical or aggregated form, such as X amount of CAFOs in X county, said Beth Levine, press secretary for Grassley. More: http://www.capitalpress.com/newsletter/CRD-EPA-bill-092413 July 25, 2013 Capital Press
Still Time to Register for Leadership Institute
Deadline is 12 midnight, Tuesday, August 6. There are a few openings for managers and one opening for appraisers. Register Now for Leadership Institute: http://portal.asfmra.org/Scripts/4Disapi.dll/4DCGI/cms/review.html?Action=CMS_Document&DocID=168&MenuKey=123