Future of farm bill energy provisions 'murky' as deadline nears

By Holly Jessen | July 13, 2012

With such wide differences between the existing versions of the farm bill in the U.S. Senate and the House of Representatives it’s unknown if Congress will be able to agree on a new farm bill before the old one expires Sept. 30. “At this stage there are really no clear or easy answers for the farm bill, it’s just pretty murky,” said Brian Jennings, executive vice president of the American Coalition for Ethanol.

The bill, which is formally known as the Agriculture Reform, Food and Jobs Act of 2012, recently passed in the House Agricultural Committee. The full Senate had previously passed its version, which is very different from the one in the House.

Groups like the American Coalition for Ethanol, the Agriculture Energy Coalition and others have expressed concern that while the House version does retain energy title programs it does not provide mandatory funding levels. Instead, it calls for discretionary funding for the Biorefinery Assistance Program, the Bioenergy Program for Advanced Biofuels, Rural Energy for America Program and the Biomass Crop Assistance Program. This means the funding would be subject to approval through the annual appropriations program in Congress, Jennings said. Another even more “troubling” thing is that the House version would prohibit USDA from using REAP funding for grants for blender pump installations, as it has in the past, he added.  

The Senate Version, on the other hand, does provide mandatory funding levels for energy title programs and allows USDA to continue using REAP money for blender pump grants. “When it comes to the energy title, when it comes to biofuels, these two bills are very, very different,” Jennings said, “with the Senate bill [supporting] biofuel initiatives and the House bill really cutting them or discouraging biofuel development.”

Lloyd Ritter, co-director of the Agriculture Energy Coalition said the House missed a “huge opportunity” to support rural America and job creation. Energy title programs have successfully helped revitalize rural communities and create new markets for agricultural products across the country. “Simply put we think the Senate got it right and the House didn’t,” he said.

The Renewable Fuels Association said it understood that budget challenges exist but continued to urge Congress to fund energy initiatives at appropriate levels. “Rural America is now inseparable from the discussion about our energy future,” said Matt Hartwig, RFA’s communications director. “Any farm bill should recognize this reality and provide USDA with the funding it will need to invest in new technologies and infrastructure to bring the energy produced in rural areas to the market.”  

The next step, said Tom Buis, CEO of Growth Energy, is for full consideration of the bill on the House floor. However, it’s unknown when that might happen.

It’s a “big question mark” whether the bill will even make it to the floor of the House for debate, Jennings said. Although the ethanol industry has concerns about the House version, there are larger issues with the bill. For example, it cuts $16 million in nutritional programs, meaning Representatives from urban areas aren’t likely to support it, making its passage nearly impossible, he said.

In the past, when Congress has been unable to pass the farm bill before the deadline it has been extended. Basically, that amounts to “kicking the can down road until after the election,” Jennings said. “I would guess, as dysfunctional as Congress is, they are not crazy enough to allow the farm bill to expire and they will find some way to either extend the current farm bill or, remarkably they will find some way to get this done through regular order, but the clock is ticking against them.”

In a written statement Rep. Frank Lucas, R-Okla., chairman of the House Ag Committee, urged House leadership to bring the farm bill to the floor for a vote. He called it a tough but fair bill that provides deficit reduction and reform. “[It] will contribute more than $35 billion to deficit reduction with $14 billion coming from the farm safety net, $6 billion coming from conservation programs and $16 billion from nutrition reforms,” he told the committee.Reducing government spending and reforming government programs is never an easy task. We face difficult choices, but it is our responsibility to cut costs and improve program efficiency so that we can once again live within our means.”