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February 17, 2003   Email to Friend 

Debra Davis
(334) 613-4686
February 17, 2003

WASHINGTON, D.C. - After many high level meetings, a deal was reached between the House and Senate to provide $3.1 billion for agriculture disaster assistance. The disaster assistance package was a major stumbling block that had prevented the completion of the FY03 omnibus-spending bill, which encompasses the 11 appropriations provisions, including agriculture, which were not completed before Congress recessed in December.

"We are pleased that the final drought assistance provision provides targeted disaster relief to those farmers who need it the most, "said House Agriculture Committee Chairman Bob Goodlatte. Goodlatte expressed concern regarding the funding for the disaster package, "Breaking open the Farm Bill, before it has even been implemented, is a serious matter. This is a dangerous precedent, which we strongly opposed throughout the course of these negotiations." Goodlatte cautioned the agriculture community to be vigilant to protect the Farm Bill and to make sure that the assistance given now will not harm agriculture programs in the long run.

The House and White House negotiators insisted the disaster assistance be paid for with dollars from mandatory farm program spending. Sources indicate the negotiators agreed to take the $3.1 billion from the Conservation Security Program.

The disaster assistance will be based on the previously established formula, requiring there be at least a 35 percent loss on the commodity. However, the formula is adjusted slightly to reduce costs - farmers with crop insurance will receive 50 percent of the price for the crop while those without will receive 45 percent. Additionally, if the farmer suffers losses in both 2001 and 2002, the producer must select one of the years as the basis to receive assistance. The negotiators of the package state this provision would provide up to $90 per acre for an average corn or cotton farm, $60 per acre for average soybean farm and $40 per acre for a wheat farm.

A payment limitation provision was included in the package. The disaster assistance payment would be reduced by any crop insurance indemnity received, so a producer would not receive more than 95 percent the value of the crop. Producers who accept disaster assistance but did not have crop insurance will be required to purchase crop insurance for the insurable commodity for the next two years.

Here are some of the highlights of the disaster assistance package:

$ 365 million livestock assistance

$ 54 million to tobacco producers - for losses associated with quota reductions, pests, and diseases.

$ 50 million to cottonseed producers and first handlers - for losses from hurricanes in 2002

$ 60 million to sugar cane farmers for hurricane losses

$ 60 million to sugar beet farmers for production or quality losses in 2001 or 2002

$ 18 million to compensate citrus growers in Florida whose trees were removed as part of the citrus canker control efforts.

For more information, read the latest edition of the Alfa Farmers Washington Ag Update at:

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