Reviewing the State of the Farm Bill: Perspective from Spending
Looking ahead to potential farm bill reauthorization this year also presents opportunities to review the 2014 Farm Bill. One of
the key issues surrounding the last farm bill was the Congressional focus on reducing Federal spending. As such, this article
compares updated reports and estimates of spending (outlays) compared to what was expected from the bill when Congress passed
it. The comparisons are based on the Congressional Budget Office, using their forecasts and projections (CBO).
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USDA Unveils New Online Tool for Farmers
U.S. Secretary of Agriculture Sonny Perdue unveiled a new website, Farmers.gov, last week. The new interactive one-stop website
for producers will be maintained by USDA. Farmers.gov is now live but will have multiple features added over the coming months
to allow agricultural producers to make appointments with USDA offices, file forms, and apply for USDA programs.
Learn About the New Tool
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WOTUS Applicability Date Extended
The EPA and Army Corps of Engineers finalized a rule last week adding a two-year applicability date to the 2015 Waters of the
United States Rule. This date change is intended to provide clarity and certainty about which definition of “waters of the
United States” is applicable nationwide in response to judicial actions over the previous issued.
The 2015 Rule, which redefined the scope of where the Clean Water Act applies, had an effective date of August 28, 2015. The
U.S. Court of Appeals for the Sixth Circuit’s nationwide stay halted implementation of the 2015 Rule. But last week the Supreme
Court determined that the U.S. Courts of Appeals do not have original jurisdiction to review these challenges and, therefore,
the Sixth Circuit lacked authority to issue a stay. Given uncertainty about litigation in multiple district courts over the
2015 Rule, the extension of the applicability date provides certainty and clarity to the regulated community during the ongoing
regulatory process.
The date extension is separate from the two-step process the agencies are currently taking to reconsider the 2015 Rule. The
public comment period for the Step 1 rule proposing to rescind the 2015 Rule closed in September 2017, and those comments are currently under review by the agencies.
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Another Continuing Resolution Expected
After shutting down the government briefly in January, the current Continuing Resolution (CR) keeping the government funded
expires this week (February 8). Congress and the Administration have yet to reach an agreement over top line spending numbers
for FY 2018, nor have they reached an agreement on immigration reforms. So, another CR is needed to keep the government funded.
Currently, Congress is considering a 6-week CR through March 23rd.
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Few Big Ag Companies Have Followed Through on Data Transperency Pledge
Just nine of 30 agribusiness companies have followed through on a pledge to implement the Farm Bureau's 2014 "Core Principles"
for transparency in the collection of farmers’ data.
Among those who have yet to do so are some of the industry’s biggest players – Monsanto, Dow DuPont, John Deere and CNH
Industrial, the equipment manufacturing company that makes both the Case IH and New Holland brands of combines, tractors and
other equipment.
The initiative, began by the American Farm Bureau Federation four years ago and supported by these very same companies, led to
the creation of an online tool – the Ag Data Transparency Evaluator – to help farmers make better decisions on the tech
companies that offer them data services.
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Could Grain Farmers Elect to Switch to PLC in 2018?
The House Agriculture Committees and the Senate Committee on Agriculture Nutrition and Forestry have been writing a new farm
bill that would replace the Agricultural Act of 2014, the farm bill that is scheduled to expire at the end of the 2018 fiscal
year Sept. 30.
But what if Congress doesn’t pass a new law? Would the committees be able to pass an extension of the current law with one
important change – allowing farmers to switch from Agricultural Risk Coverage to the Price Loss Coverage program?
That’s what Texas A&M University’s Agricultural and Food Policy Center is assuming in its “Baseline Outlook” for the cash flow
and equity positions for the 100 or so U.S. representative farms it maintains to help Congress better understand the current
state of U.S. agriculture and its supporting industries. (The Congressional Budget Office has adopted the same set of
assumptions.)
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The Digital Divide Must End
Studies estimate that precision agriculture technologies can reduce your farm operation’s costs by up to $25 dollars per acre
and increase farm yields by up to 70% by 2050. These cost savings and production benefits cannot be realized without reliable
access to broadband Internet service. Despite the growing demand on farms and ranches across rural America, this service is
still not consistently available where it is needed.
A bill, which was introduced in the Senate by Senators Roger Wicker and Amy Klobucher and in the House by Congressmen Bob Latta
and Dave Loebsack, will help facilitate the deployment of broadband internet across rural America. This would include ranch and
farmland where broadband connectivity is increasingly essential for production agriculture.
The legislation, which requires the Federal Communications Commission to create a task force for meeting the connectivity and
technology needs of precision agriculture in the U.S., was recently applauded by the Agricultural Broadband Coalition.
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Trump Wants $1.5 Trillion For Infastructure; One Fourth For Rural Projects
After declaring “America is a nation of builders,” President Trump asked Congress to write a bill that would fund $1.5 trillion
in “gleaming new roads, bridges, highways, railways, and waterways across our land” — much of it financed by state, local, and
private-sector money. A quarter of the federal funds would be earmarked for rural projects, including broadening access to
high-speed internet service, said the White House.
“Any bill must also streamline the permitting and approval process — getting it down to no more than two years, and perhaps
even one,” said the president. “I am asking both parties to come together to give us the safe, fast, reliable, and modern
infrastructure that our economy needs and our people deserve.”
A rural prosperity report delivered to Trump early this month listed universal rural access to broadband service as a
springboard for economic growth. For years, farm and agribusiness groups have called for updated roads and an overhaul of the
nation’s inland waterways. Much of the navigation system on the Upper Mississippi River, for example, was built during the
Depression. The U.S. Chamber of Commerce backs an increase in the federal fuel tax — it would be the first increase in a
quarter century — to help pay for infrastructure projects.
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Investors Drop $75M on Drone Technology
Demand for drone technology is rising and large corporations have taken notice. Investors recently gave $75 million to
PrecisionHawk Inc., a drone manufacturer, to support the growth of the drone industry.
Investors included Third Point Ventures, Comcast Ventures, Constellation Technology Ventures and Syngenta Ventures, all of
which regularly invest in technology in industries like healthcare, media, energy and agriculture.
Many of the investors saw this as an opportunity to improve technology in an industry that was important to their consumers.
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A Discussion of the Sec 199A Deduction and Its Potential Impacts on Producers and Grain Marketing Firms
The newly passed Tax Cuts and Jobs Act of 2017 introduced substantive changes to individual and entity-level tax rates and
deductions, many of them welcomed by individuals and corporations. One section of the Internal Revenue Code (IRC) in
particular--IRC § 199A Deduction for Qualified Business Income of Pass-Through Entities (Sec 199A hereafter)--is getting a lot
of attention, raising questions and eyebrows for its potential impacts on grain marketing decisions. In essence, language in
this section of code gives producers marketing grain a significant incentive to sell to a cooperative rather than a non-
cooperative firm.
The purpose of this article is to highlight the primary features of the Sec 199A deduction causing concern and discuss
potential implications for producers and grain marketing firms. Note that at one month into the new tax year, there are ongoing
efforts directed at modifying the language in the code to correct the unintended effects on producers and grain marketing
firms.
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Iowa Chapter Meeting
The Iowa Chapter held a successful chapter meeting last week in Ames, IA. Attendance was high and ASFMRA President Dave GaNunn, ARA stopped by.
Last week, the Appraiser Qualifications Board (AQB) adopted revisions to the Real Property Appraiser Qualification Criteria (Criteria). The changes will provide additional methods for entry into the real property appraisal profession in the United States. The Criteria will become effective on May 1, 2018.
The changes were the result of a nearly three-year process of deliberations, which included the issuance of a discussion draft, concept paper, and four exposure drafts. The proposed changes were publicly vetted at a formal hearing, focus group session, and at several public board meetings. The proposed changes generated over 1,300 comment letters. The changes include a number of options for entry into the residential appraisal profession. Additionally, the number of experience hours and timeframe for obtaining that experience have been modified.
Read the Draft