Washington Report for 5-6-13

By Steve Kopperud

Lucas Set to Go on Farm Bill Markup; Stabenow Could Move Next Week

House Agriculture Committee Chairman Frank Lucas (R-OK) not only confirmed he's on track to mark up a five-year 2013 Farm Bill May 15, but this year's version will cut $38 billion out of U.S. Department of Agriculture spending over 10 years, $11 billion more than his committee's 2012 version. More than half of the cuts will come from the Supplemental Nutrition Assistance Program, formerly known as food stamps, but he declined to detail where the other $20 billion will be cut, other than to say the $5-billion-a-year direct payment programs are history. Meanwhile, Sen. Debbie Stabenow (D-MI), chairwoman of the Senate Agriculture Committee, is reportedly set to gavel her committee into markup this week, according to Sen. Charles Grassley (R-IA). "That's what I've heard and that's what I'll be ready for," Grassley told reporters. Both chairs want their bills ready for full House and Senate floor action by mid-June, with conference action in enough time to get a new comprehensive law in place by the end of September. As expected, the Senate Farm Bill will be almost identical to the bill passed by the full Senate in 2012. The big difference will be the commodity title, Grassley said, describing it as the only title in the Senate's bill not resolved for the most part. The Senate bill will seek to cut about $23 billion, the same total savings achieved in 2012. However, the Congressional Budget Office now scores the 2012 Senate bill at about $13 billion in savings, so Stabenow is going to have to get more creative or cut deeper into some programs. The Senate only cut SNAP funding by about $4 billion last year and Democrat resistance to cutting more runs deep. However, Sen. John Thune (R-SD) has a bill that will cut SNAP by $30 billion over 10 years, and Stabenow may allow cuts in food stamps to be fought out on the floor. Grassley says there may also be proposal to further reduce federal crop insurance funding, but they won't succeed. Cutting crop insurance premium subsidies will just lead to the likelihood of higher disaster payments, Grassley said. Further complicating Senate committee consideration is whether or not Stabenow will allow the highly controversial United Egg Producers-Humane Society of the U.S. "enriched cages" hen housing bill to be included in the committee bill that's presented for markup.  

Boxer to Hold Oversight Hearing on West, Texas Chemical Plant Explosion

Oversight hearings into what the federal government knew, what it didn't know and how it responded to the April 17 explosion at a West, Texas fertilizer/chemical plant that killed 15 and injured hundreds will be held by the Senate Environment & Public Works Committee, announced committee Chairwoman Barbara Boxer (D-CA). At the same time, Rep. Henry Waxman (D-CA) and Rep. Bennie Thompson (D-MS) sent a letter to President Obama demanding the creation of a "blue ribbon commission" to investigate the West, Texas explosion. Boxer has written to both the Environmental Protection Agency and the U.S. Chemical Safety Board asking pointed questions, including wanting to know the extent of EPA's investigation of the explosion and any timelines; because the plant stored "large amounts" of ammonium nitrate, why ammonium nitrate is not a covered chemical under EPA's Risk Management Program; what types of chemicals EPA could add to the RMP list; a list of all chemicals facilities that are required to report to local officials but not to EPA; which facilities are regulated under Sec. 112(r) of the Clean Air Act, where they're located and how often they're inspected; who at EPA is in charge of these facilities; any and all fines levied against the West facility for failure to comply with safety standards; and general information regarding how EPA works with local agencies and how this system can be improved. No date has been set for the oversight hearings.

Immigration Reform Action Begins in House with Goodlatte Ag Worker Bill

While the Gang of Eight Senators is pushing bipartisan, comprehensive immigration reform legislation, the Senate preps for Judiciary Committee markup of the bill May 8. The House made good on its word to move its version of immigration reform legislation through a series of shorter focused bills rather than a single legislative package. Rep. Bob Goodlatte (R-VA), chairman of the House Judiciary Committee, introduced his ag guest worker bill visa bill. The Goodlatte bill would allow more ag workers into the country than the Senate bill, capping a new H-2C visa program at 500,000 workers compared with 112,000 in the Senate version. Goodlatte's version would allow workers to stay in the country for up to three years, but they would be required to leave the country periodically. The Senate bill allows for a five-year period before a worker would need to leave the country. The bill also covers jobs in meat processing. Further, Goodlatte's bill lacks the "fast track" green card option available in the Senate bill that would allow undocumented aliens in the program to qualify after five years. While the meat and poultry industries praised the bill, the United Farm Workers, which negotiated with ag growers on the Senate language, strongly criticized the legislation. The ag growers coalition said its support remains with the Senate bill. Goodlatte said he expects to introduce a series of reform measures over the next several weeks.

House Committee Takes Comments on RFS Impact on Agriculture, Food Production

Just about all of animal agriculture, the ethanol industry and the petroleum industry sent comments to the House Energy & Commerce Committee, responding to a white paper prepared and released by the committee on the ethanol Renewable Fuel Standard. The committee asked stakeholders to submit comments on the paper and to provide answers to several questions. Growth Energy praised the RFS, calling it one of "the most successful energy policies in the last 40 years," saying it has had "a tremendous positive impact on the agriculture sector and on consumer prices at the pump." The National Pork Producers Council told the committee the RFS "failed to provide any flexibility to account for changes in market conditions that can greatly affect" the ag sector, and reminded the committee that the Environmental Protection Agency refused to grant a waiver on the ethanol RFS in 2012. NPPC called for reform of the RFS to "ensure a fair and equitable distribution of natural marketplace risks among all end users of corn and other grains." The Renewable Fuels Association said the RFS is part of a formula to "increase demand for agricultural products and enhance farm income," calling it the single "most important value-added market for ... grain farmers, simulating investment ... and enhancing economic opportunities."

Chemical Industry Weighs in on Anti-Competition Action Against Rails

A class action antitrust case brought by shippers against Union Pacific, BSNF, Norfolk Southern and CSX elicited a strong statement of support from the American Chemistry Council. The council said the suit, alleging fuel surcharges imposed on shippers from 2003 to 2008, represents surcharge "price fixing," "causing members of the Council and other shippers to pay excessive charges for freight rail shipments." Because railroad mergers have led to far less competition, 75 percent of all freight rail stations are captive to a single major railroad, ACC said. "This extraordinary market power has enabled railroads to charge shippers higher rates and extra fees, including fuel surcharges." ACC said a 2006 study it commissioned showed fuel surcharges imposed by rails exceeded by $6.4 billion the actual fuel costs that the surcharges were supposed to recover, and cited a survey released in 2013 that shows chemical shippers are continuing to pay the fuel surcharges.             

Court Dumps Enviro Suit Against EPA

A U.S. District Court suit brought against the Environmental Protection Agency by two environmental groups alleging the registration of more than 380 chemicals negatively impacted 214 species in 49 states was dismissed by the court. EPA, along with Crop Life America filed for the dismissal of the so-called "mega suit" claiming the two enviro groups’ complaint lacked specific information on what the agency had or had not done relative to the chemicals. Further, the two said the suit was filed in the wrong court and had missed the statutory deadline for filing a chemical registration challenge under RCRA. The judge told the plaintiffs – the Pesticide Action Network and the Center for Biological Diversity – they have 30 days to amend their complaint or appeal the judge's ruling within 60 days. Several crop protection and chemical industry groups were granted intervenor status in the suit, which if not dismissed, would have drastically altered crop production and productivity in the U.S.

USDA Musical Chairs, and Other Administration Changes

Michael Scuse, former U.S. Department of Agriculture undersecretary for farm and foreign agriculture services, has been named acting deputy secretary of agriculture replacing Kathleen Merrigan, who left the department. Scuse is former Delaware secretary of agriculture. Darci Vetter, deputy undersecretary under Scuse, will become acting undersecretary and Suzanne Heinen, administrator of Foreign Agriculture Service, will move up to Vetter's old job. Phil Karsting, former staff director for retired Sen. Herb Kohl (D-WI), becomes head of FAS. Doug O'Brien will serve as acting undersecretary for rural development, replacing Dallas Tonsager who retired, and Ann Mills will become acting undersecretary for natural resources and environment. Over at the Environmental Protection Agency, Shaun McGrath has been named regional administrator for EPA Region 8 in Denver. McGrath was former director for the American Solar Energy Society in Boulder, Colo., and began his career in Kansas working in the state Department of Commerce European office. He's the former mayor of Boulder, and spent 10 years working with the Western Governors' Association. Charlotte, N.C. Mayor Anthony Foxx has been nominated to replace Ray LaHood as secretary of transportation. Foxx, a former Department of Justice U.S. attorney, has a strong national reputation for intermodal investment and development on behalf of Charlotte.