Posted on Mon, Feb. 01, 2010
last updated: February 01, 2010 04:53:36 PM
WASHINGTON — Crop and farm-trade subsidies would be shaved under the Obama administration's familiar sounding fiscal 2011 budget proposed Monday.
Resurrecting previously failed money-saving ideas, the White House wants to cut payments to wealthy farmers and shrink an overseas marketing program much favored by California fruit and vegetable farmers.
If Congress goes along, reducing the Market Access Program and curtailing subsidies for crops like cotton and rice could save taxpayers tens of millions of dollars.
"It's time we put our fiscal house in order," Agriculture Secretary Tom Vilsack said.
The administration gives as well as takes. The budget includes an increase for habit restoration and water supply efforts centered around the Sacramento-San Joaquin Delta. a record $429 million for agricultural and food research, and enhanced spending for certain trade promotion efforts.
Proposed cuts, though, mobilize more Capitol Hill attention.
The administration wants to eliminate California's special $10 million earmark that pays for farmers to retrofit diesel engines. The budget eliminates Agricultural Research Service facility construction. It eliminates an Agriculture Department "economic action program" that has provided small grants to timber-dependent communities in Stanislaus, Tuolumne and Mariposa counties, among others.
President Barack Obama called out the economic action program for special criticism, complaining Monday that it "strayed so far from any mission that it funded a music festival." He did not identify the festival.
Congress largely ignored many similar budget-cutting arguments raised last year. The administration seems ambivalent about items like the Market Access Program, which helps groups like the California Kiwifruit Commission fund overseas marketing.
The president proposes cutting Market Access Program spending from $200 million to $192 million, and then to $162 million the next year. On Monday, the Office of Management and Budget argued that the Market Access Program's "economic impact is unclear and it does not serve a clear need."
Only last week, though, Agriculture Secretary Vilsack called the program "more important than ever" as he announced millions of dollars in grants for 17 California farm groups, including the California Asparagus Commission, the California Prune Board and the California Table Grape Commission.
"I think we have to look at the proposed cut with concern," said Edward Beckman, executive director of the Fresno-based California Fresh Tomato Growers. "We have an industry that's export dependent."
This year, the fresh tomato group is sharing a $900,000 Market Access Program grant with a similar organization in Florida. Beckman said the money "simply helps level the playing field" by funding in-store promotions, research and other work.
The administration also proposes cutting the conventional crop subsidies known as direct payments. In 2005, the most recent year for which figures are available, California farmers received $169 million in direct payments.
Obama proposes reducing the maximum direct payment to $30,000, down from the current $40,000. Obama also proposes cutting off direct payments to farmers with annual farm income over $500,000. The current farm income cutoff is $750,000. California lawmakers have resisted similar income-testing reductions, reasoning that it would unfairly penalize the state's large and efficient farmers.
As in previous budget proposals, the Agriculture Department is again asking for additional food inspection user fees, which Congress typically is loathe to accept.
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