On May 21, 2008, President Bush vetoed H.R. 2419, the original Farm Bill. On May 22, the Congress enacted the bill into law – by overriding the President’s veto.  However, due to a glitch in the enrollment process, this version of the legislation inadvertently did not include Title III of the bill.

On May 22, 2008, the House passed a new bill -- H.R. 6124 -- containing all 15 Farm Bill titles, by a vote of 306 to 110. The Senate then passed H.R. 6124 on June 5 by a vote of 77 to 15. President Bush again vetoed the bill.

On June 18, 2008,  the House passed the Farm Bill, H.R. 6124, by a vote of 317 to 109 over the President’s veto.    

The farm bill will ease the strain of rising food prices for millions of families, take a first step on much-needed reforms to farm payments, and make a substantial commitment to land conservation and to the fruit and vegetable industry.

Help With Rising Food Costs in America

• Nearly three-fourths of the Farm Bill, an additional $10.4 billion in new spending, goes to nutrition programs that help 38 million American families afford healthy food.
• It updates the food stamp program to reflect the current state of our economy, as proposed by the Bush Administration.  These critical food stamp provisions will help about 11 million people by 2012.  Households with children receive 77% of food stamp benefits.
• The measure eliminates the current cap on childcare costs, provides incentives for families to save for retirement or education, and makes sure that the families of soldiers in combat are not penalized under the food stamp program.  It increases the standard deduction and indexes it to inflation to help needy families afford increasing food prices in the future.  The minimum benefit would be increased for the first time in 30 years and would increase in the future with to keep up with rising food prices.
• Provides much-needed support to emergency feeding organizations, such as food banks, food pantries, and soup kitchens by increasing funding for TEFAP by $1.25 billion – with $50 million for immediate shortages at food pantries.
• Helps schools provide healthy snacks to students, with $1 billion for free fresh fruits and vegetables.

• The price sensitive safety net that is the centerpiece of farm programs provides supplemental income when farmers are struggling.  
• Reforms disaster assistance to make it a permanent, paid for program for farmers with crops stricken by natural disasters such as drought and flood.  
• Makes critical food labeling of our meat supply and produce mandatory after six years of Republican delays.  Recent food scares have made Americans more interested in knowing where their food comes from.
• Every penny of new spending in the bill is fully paid for, to prevent further increases to the national debt, which has skyrocketed since 2001, contributed to our economic downturn, and mortgaged our children’s future.  

• Commodity programs account for less than 13% of the Farm Bill—and decline by $60 billion over the next ten years compared to the last Farm Bill in 2002.
• This bill begins to end payments to farmers who don’t need the help, with the most significant reforms in over 30 years.  It reduces the cap for non-farm income by 80%, to $500,000, and puts in place the first-ever cap for farm income at $750,000 for fixed direct payments.  
• The bill reduces direct farm payments by $300 million; the Administration proposed increasing these fixed payments by $5.5 billion, even though they are paid out regardless of farm prices.
• It cuts federal payments to crop insurance companies that are making windfall profits due to higher crop prices by $5.7 billion.  
• Contrary to Administration claims, marketing loan and target price supports do not increase government payments at a time of record income under the bill.  They pay farmers only if prices drop.
• The bill also closes a loophole (the three-entity rule) that for decades has allowed some to collect up to double the farm payment limits by collecting cash on more than one business.
• The bill includes tax reforms to limit the use of farming losses to reduce their taxes on non-farm income.  
• For eight years, the Administration has failed to act on reform even though it had authority to tighten rules on farm programs payment eligibility.

• Conservation programs are boosted by $7.9 billion, which reduce soil erosion, enhance water supplies, improve water and air quality, increase wildlife habitat and reduce damage caused by floods and other natural disasters.
• Fruit and vegetable producers will have their own place in the Farm Bill for the first time and will benefit from more than $1.3 billion for new programs that support research, pest management, trade promotion and nutrition for the industry.

•  Food shortages and food inflation are due to many factors:
  • o Spiking oil and energy costs.
    o A weakened U.S. dollar that limits domestic supply by increasing exports.
    o Historically low levels of global stocks of corn, wheat, and soybeans due to drought in Australia and Eastern Europe and poor weather in Canada, Western Europe, and the Ukraine.
    o Rising demand in Asia and other regions for high-value foods such as meat.
• America is the world’s biggest provider of food aid, with more than $2.1 billion to 78 countries in 2007.
• The Farm bill provides $60 million, on top of the existing Food for Peace international aid program, to purchase emergency food aid overseas and provides an additional $84 million for the McGovern-Dole International Food for Education and Child Nutrition Program for infant, child, and school nutrition programs in underdeveloped countries.
• The Supplemental, which will be considered shortly by the House, includes $1.62 billion for emergency international food aid in FY 2008 and FY 2009 -- $500 million more than the President’s request.  

• Ethanol is helping to reduce fuel prices at the pump.  It is lowering gas prices by 15% from where they might be otherwise if biofuel producers were not increasing output, according to a Merrill Lynch analysis. Other analysts from consumer and farm groups, as well as the University of Iowa, concur that ethanol is lowering the price of gasoline.
• Congress is promoting the development of biofuels from non-corn sources.
  o The Renewable Fuels Standard that was part of the 2007 Energy law -- which is not fully implemented yet -- requires that 2/3 of our fuel needs be met by non-food feedstocks for biofuels, such as switchgrass and woodchips.
  o The Farm Bill takes another critical step in transitioning biofuels beyond corn— by reducing the current tax credit for corn-based ethanol by six cents per gallon and creating a new tax credit to promote the production of cellulosic biofuels.
  o The Farm Bill invests $1 billion in renewable energy focusing on new technologies and new sources, including $320 million in loan guarantees for biorefineries that produce advanced biofuels and a new program to encourage the production of new biomass for cellulosic ethanol and other energy production, helping producers learn how to harvest, store, and transport biomass to bioenergy facilities.