House and Senate Agriculture Committee leaders are working hard to
craft a compromise between the Farm Bills passed by the House and
Senate last year. President Bush has said "if Congress sends me
legislation that raises taxes or [does] not make needed reforms, I'm
going to veto it." Things are changing by the minute, but here is a
quick update.

House Proposal Would Slash CRP, WRP

House Committee Chair Collin Peterson (D-MN) and Ranking Republican
Bob Goodlatte (R-VA) released the outline of a proposal this week
that they said is designed to meet the White House demand for a Farm
Bill that does not raise taxes. The outline includes about $6 billion
more in spending overall than the `budget baseline' for the Farm Bill
over the next 10 years.

Included in the outline were "programmatic changes that illustrate
how the outline could be applied," saying the program ideas
are "purely illustrative" and the details would be decided in
conference (the letter and 3-page outline are posted on the House
Agriculture Committee web site,
http://agriculture.house.gov/inside/FarmBill.html). However, the
outline seems to show what the two are thinking in terms of
conservation. The proposed outline sets out funding for a 10 year
farm bill, but has failed to expand funding accordingly for several
conservation programs, which would only receive funding for the first
five years. Included, as we understand the outline, are:

* A major cut in the Conservation Reserve Program from the current
39.2 million acres authorized to 32 million acres by 2010, a $1.2
billion cut over ten years. The reduced cap would allow continuous
signup and Conservation Reserve Enhancement Program enrollments to
continue, but essentially eliminate the possibility of whole-field
enrollments to replace expiring contracts in the next several years.
In October, contracts expired on over 2 million acres of CRP
nationwide, leaving about 34.2 million acres of CRP contracts in
place.

* A major cut in the Wetlands Reserve Program from the 250,000 acres
per year (included in both the Senate and House bills) to 200,000
acres, a cut of about $400 million over five years, and no funding in
the second five years of the ten year bill.

* $1.3 billion less for the Conservation Security Program over ten
years than in the Senate bill.

* The Wildlife Habitat Incentives Program would continue at current
levels, and the Grassland Reserve Program would be reauthorized at
$432 million for the first five years, with no funding in years 6-
10. This would enable enrollment of 1.3 million acres over the next
five years. (USDA enrolled 1 million acres as a result of the 2002
Farm Bill).

* A huge increase in the budget for the Environmental Quality
Incentives Program and Farm and Ranchland Protection Program, two
programs that generally provide the least wildlife benefits per
dollar spent.

In the Senate

Press reports have circulated that Senators Max Baucus (D-MT) and
Kent Conrad (D-ND) are circulating a draft proposal for conferees
that would take a different approach than the House.
The proposal reportedly would spend a much larger amount over
baseline (including a 5 billion dollar permanent disaster program),
using tax offsets the administration has threatened to veto. Despite
the increased overall budget, this proposal would include a cut of $1
to $1.5 billion over five years to the Conservation Title included in
the Senate bill, but there is no word on what programs would be cut.

Meanwhile, DTN reports that Senate Agriculture Chair Tom Harkin (D-
IA) says he will respond to the House outline with a proposal for a
five-year Farm Bill, one that includes more of an increase in overall
funding than is included in the House outline. Harkin also said he
wanted a 5-year Farm Bill, rather than a 10-year Farm Bill.

On Wednesday, Agriculture Secretary Ed Schafer signaled the
Administration's support for the budget numbers outlined in the House
proposal, while indicating that the Administration's proposals for
tighter caps on commodity payments were still important.

If no agreement is reached on an overall funding number for the Farm
Bill today, House Chairman Peterson says it will be nearly impossible
to finalize the Farm Bill prior to expiration of the current bill on
March 15. At that time, permanent agricultural law would resume,
meaning current conservation obligations could be funded for the rest
of the year, but no new money could be committed until a new Farm
Bill is passed.

House and Senate members are expected to leave for recess at the end
of this week, returning February 25.

Note: for serious policy wonks, posted on the House Agriculture
Committee web site is a side-by-side comparison of the language of
the separate Farm Bills passed by the House last July and the Senate
last December.