Bush Signs FY03 Budget Bill; CSP Rulemaking Process Announced

Friday,February 21, 2003                   By Shawn Wade

      TheFY2003 Omnibus Appropriations bill cleared its last hurdle late Thursday whenPresident George W. Bush signed the legislation into law.

      Nowthe process of implementing new programs and operating budgets for federalagencies begins in earnest. It also means that the process to implement the2001-2002 Agriculture Disaster provisions of the bill will also officially getunderway.

      Thatis good news to producers and commodity groups who have been working diligentlyfor two years to secure this much needed offset to severe physical losses. Mostof the losses addressed by the new program were incurred during the 2001 and2002 growing seasons, mainly through the lingering effects of extreme droughtconditions.

      ForPlains Cotton Growers, Inc. it means a new focus on providing input on how theprogram will be implemented. PCG will be pushing for maximum flexibility forthe producer to be able to obtain disaster assistance for either 2001 or 2002on every affected acre.

      Alsoimportant will be the implementation decisions involving the new 95 percentbenefit cap included in the program.

      Mostother program features are already familiar to producers. Going by the languageimplementing the program, most of the rules necessary to carry out the programwill be based on the 2000-crop disaster assistance package, updated to reflectnew payment rates and other specifics.

      Fundingfor the program was influenced by continued pressure from the Administration touse offsets tied to the current Farm program. This facet of the process isconsidered by many to be a good news/bad news situation.

      Thebad news is that many folks believe it has opened the gate and threatens tounleash a stampede of attempts to raid the farm program every time money isneeded. It is also felt it will provide future opportunities for opponents offarm program spending to attack key components of the program, specificallythose important to cotton.

      Thegood news is that the offsets used to pay for the program came in a typicallyWashingtonian fashion involving updated budget projections, newly imposedspending caps based on the new projections and then cuts to program fundingyears down the road.

      Thefocus of all this budget effort was the brand-new Conservation Security Program(CSP). Cost of the CSP had been scored relatively low during the development ofthe Farm Bill and it appeared that pressure was mounting to write the rulesimplementing CSP in such a way that only that amount would or could be spent.

      Thatis where things really got interesting. First CSP received a revised costestimate that jumped anticipated spending levels from $2 Billion over ten yearsto $7.7 Billion over 11 years.

      Nextcame the budget axe, trimming the required $3.1 Billion out of the $7.7 BillionCSP projection to pay for the disaster package and installing a hard cap of$4.6 Billion on the CSP expenditures through 2013. So, what does it mean?

      Inthe end Congress found a way to pay for the disaster assistance package,essentially double the funding available for CSP and install a “fiscallyresponsible” hard cap on what was supposed to be an unlimited entitlementprogram

      Thelatest information available regarding the rulemaking process for the CSPprogram came earlier in the week when USDA published its advance notice ofrulemaking for the CSP in the Federal Register.

      Fewdetails were provided in this announcement, although it did provide adefinition of the CSP and officially opened the line of communication betweenUSDA and the general public wanting to provide input during the development ofCSP rules.

      TheUSDA notice also notes the department’s vision for CSP is: “To identify andmeaningfully reward those farmers and ranchers meeting the very higheststandards of conservation and environmental management on their operations; Tocreate powerful incentives for other producers to meet those same standards ofconservation performance on their operations; and, To provide public benefitsfor generations to come. In short, CSP should reward the best and motivate therest.”


2002 DCP Sign-up Nearing End; Producers Encouraged to Complete Process

Friday,February 21, 2003                   By Shawn Wade

      Sign-upfor the Direct and Counter-Cyclical Program (DCP) continues to lag and the USDAFarm Service Agency personnel are reminding growers that intend to participatethat the deadline for completing sign-up is getting close.

      Thedeadline for owners or their appointed representative to make initial base andyield option selections for the DCP program is April 1. The deadline forprogram participants to sign-up for the 2002 and 2003 DCP program is June 2,2003.

      Boththe initial base and yield option selection and the decisions to participate inthe 2002 and 2003 DCP program can be completed at the same time.

      2002and 2003 DCP payments for the balance of the 2002 direct payment, 2002counter-cyclical advance payments, and the advance for the 2003 direct paymentwill be processed as soon as sign-up is completed.

      Producersare encouraged to contact their county FSA office and schedule an appointment.