October 28, 2015

Contact: Andrew Jerome, 202-314-3106

WASHINGTON (October 28, 2015) – National Farmers Union (NFU) President Roger Johnson today voiced cautious optimism over the budget deal passed by the U.S. House of Representatives this evening. The agreement, led by the House Agriculture Committee, would remove harmful provisions that would have undermined public-private delivery of crop insurance within the upcoming omnibus package. This will prevent further consolidation of the crop insurance sector, which would have provided less choice for family farmers who depend on this cost-effective safety net program.

“No one involved in agriculture was consulted when the budget was being negotiated,” said Johnson. “It’s outrageous to think that the agriculture committees were completely left in the dark, but we are thankful that the Committee, its members, and other members of Congress stood up for a program that is critical to family farmers.”

Johnson noted that the 2014 Farm Bill provided $24 billion in savings, which accompanies the $12 billion in savings that was part of the 2011 renegotiation of the Standard Reinsurance Agreement (SRA). “While the rest of Congress has been paralyzed, the agriculture committees delivered savings in the name of deficit reduction,” he said. “It would be shameful to punish agriculture for doing its job over the last several years.”

Absent this deal, the budget would require $3 billion in cuts to the reimbursement rates between the government and the companies that sell and administer the crop insurance program. The cut, from 14 percent to 8.9 percent, is far deeper than the 12 percent of previous proposals. However, the average rate of return for participating companies has been less than 4 percent, causing many crop insurance companies to exit the sector.

“Caps already exist on administrative and operating costs for crop insurance companies, and producers pay an estimated $4 billion into this program annually. It’s time for Congress to realize that crop insurance is not a piggy bank,” noted Johnson. “We are thankful for our allies in the House and the leadership of Chairman Conaway and Ranking Member Peterson.”

“We now call on the Senate leadership to follow the House’s lead and reject cuts to crop insurance,” he said.

National Farmers Union has been working since 1902 to protect and enhance the economic well-being and quality of life for family farmers, ranchers and rural communities through advocating grassroots-driven policy positions adopted by its membership.


Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.