Statement Of Senator Patrick Leahy
At The Senate Agriculture Committee Farm Bill Implementation Hearing
May 14, 2003

I want to thank the distinguished Chairman, Senator Cochran, and the distinguished ranking member, Senator Harkin, for holding this important hearing. 

I also want to thank Secretary Veneman and her colleagues for coming here to report on the progress that has been made in implementing the 2002 Farm Bill.  It has been eight months since the last time the Secretary joined us to discuss Farm Bill implementation and one year since the Farm Bill became law. 

The past year has not been a good one for most Vermont farmers.  Dairy prices are at 25-year lows without even taking into account inflation.  With farm gate milk prices hovering around $1.11 a gallon, well below the cost of production, Vermont farmers are losing money with every drop of milk they sell. 

Some relief has been provided by the Milk Income Loss Compensation Program (MILC).  Modeled on the price support system developed by the Northeast Dairy Compact, the MILC program has provided critical support.  I continue to be concerned that the Department has developed overly strict rules for the MILC program which unduly penalize multi-family farms.  I will be interested to hear the Secretary’s views on this critical program which is virtually the only lifeline for many small family farms. I also want to know what plans the Department has for increasing milk prices which remain disastrously low. 

Secretary Veneman, at an Appropriations hearing last week, you said that the Department will need to focus this year on getting the Conservation Title of the Farm Bill fully implemented.  I agree.  The Conservation Title presents great opportunities for both our farmers and for the environment. 

I am disappointed, however, that the Department seems to have begun its work on the wrong foot.  In your Earth Day press release, you announced conservation funding levels for each state, but you did not note that the Department had failed to fulfill its requirements under the regional equity provision of the Farm Bill.  This provision provided a minimum level of conservation funding for every state.  It was needed because the Department has historically created conservation programs which work well in some regions of the country, but not in others, particularly the Northeast.  This year seems no different.  Vermont received only $100,000 more in conservation funding, despite hundreds of millions of additional dollars Congress put into conservation programs this year.  Despite huge conservation backlogs and new requirements from EPA on large farms, all of New England lost out when it came to funding for conservation projects.

Unfortunately, this is not the only major funding setback for Vermont and the rest of the Northeast.  Earlier this year, the Department transferred the vast majority of funds for the Agriculture Management Assistance from the Natural Resources Conservation Service to the Risk Management Agency.  In so doing, the Department killed an innovative program which had funded conservation and farm viability efforts, and instead created a crop insurance subsidy program which does very little for our farmers.

There is still time to change.  Funding can be shifted to revive the Agricultural Management Assistance program and comply with the regional equity language found in the Farm Bill, but it will take a good faith effort by USDA that has so far been lacking.

I have been disappointed with the Department’s lack of commitment to fully fund rural development initiatives included in the Farm Bill.  The Committee, and ultimately the full Congress, included significant increases for rural development programs because we recognized the need to invest in our nation’s rural areas.  Instead of following that lead, the proposed budget for FY 2004 would eliminate the Rural Broadband Access program, cut $40 million from the value-added development grant program and cut $23 million from the renewable energy grant program. 

All of these programs were created to help improve economic conditions and create new opportunities in rural areas.  Your Department has issued press releases over the last year announcing these initiatives and applauding the importance of the funds for rural communities across the county.  In that light I have to question why the Department would choose make these cuts now.  It is short-sighted to hamstring these programs before they demonstrate their full potential.

Madam Secretary, we have come a long way in the last year but there is still much to do.  I look forward to hearing your testimony on all of these matters.

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