INSIDE ORGANIC: Year-End Congressional Appropriations Meltdown Wipes Out Last Chance for 2007 USDA Certification Cost-Share Funding for Midwest Organic Farmers (Jan 07)
by Roger Blobaum · Inside Organics · January, 2007
The program that has provided certification cost-share funding for Midwest organic farmers since 2002 appeared to be on life support when Congress adjourned in early December without taking final action on a long list of unfinished appropriations bills. A continuing resolution to keep the bills alive until Feb. 15 offered some hope the funding could be salvaged when a new Congress returned in January.
But the chances dropped from slim to none on Dec. 11 when the incoming Democratic chairs of the House and Senate appropriations committees announced nothing further would be done on appropriations bills left unfinished when the Republican-controlled Congress left town for good. The U.S. Department of Agriculture and other agencies involved, they announced, would have to scrape by on funding levels that were in effect for 2006.
This wiped out any possibility that the $500,000 proposed for cost-share funding in the coming year would be made available in the 35 states covered by a $5 million fund provided in the 2002 farm bill. The fund has been exhausted and the $500,000 being sought through the appropriations process would have covered cost-share payments until new money could be provided in the 2007 farm bill.
Federal funding for cost-share payments in some states where the number of organic farms has been increasing rapidly, including Minnesota and Wisconsin, had already run out in 2006. In both cases, state governments provided money needed to make sure all claims were paid. A few other states reportedly have small amounts of funding left over for 2007.
Cost-Share Payments Have Averaged $400 per Farm
Although official figures for the program have been difficult to access and the numbers made available by the National Organic Program are considered unreliable, it is estimated that annual payments to farmers average roughly $400. The NOP has stated that reports sent in so far from the 35 states involved show 89 percent of the funds allocated have been used up. The funding would have been exhausted even sooner if the program’s startup had been better publicized and organized and more farmers had known about it earlier.
The program provides farmers and handlers with 75 percent of the cost of organic certification to a maximum of $500. The federal funds go to state departments of agriculture, which get a small fee for handling claims and writing the checks. This is the only federal program that provides money directly to all qualifying organic farmers in the states involved.
Getting more cost-share funding for the coming year was considered a long shot at best. The House-passed version of the USDA appropriations bill Included a $1.3 million funding increase for the National Organic Program but no cost-share funding. The stalled Senate version, which included the same funding increase for the NOP, specified that $500,000 of it would be distributed to the states for cost-share payments in 2007. In both cases, NOP funding for the current year would have been increased to $3.13 million.
The Organic Trade Association preferred the House version, saying the most urgent need was more money to handle complaints and strengthen enforcement of the Organic Foods Production Act. The National Organic Coalition and others favored the Senate version, contending that keeping the cost-share program going until new money could be provided in a farm bill also was a pressing need. A conference committee would have sorted this out if the appropriations process had been completed before Congress left town.
The $500,000 in new cost share funding also had opposition in the House from some appropriations committee members who contend organic farmers already receive extra assistance from the premiums paid in the marketplace and don’t need federal help. Some also contended the $5 million in the farm bill was “capped” and that there was no authorization for additional funding.
Smaller Separate Program Has Money
As strange as it might seem, even by Washington standards, a separate USDA cost-share program for 15 additional states has plenty of money for the coming year. This program, called the Agricultural Management Assistance Certification Cost Share Program, was authorized by the Agriculture Risk Protection Act of 2000 and its money comes from USDA’s Risk Management Agency. This state-administered program provides $1 million in new money each year without going through the appropriations process to farmers and handlers in smaller states, mainly in the Northeast.
Getting money for cost-share assistance has always been difficult. Attempts to get USDA to help underwrite the cost of certification date back to 1999 when the organic committee of the National Campaign for Sustainable Agriculture urged AMS to include a cost-share provision in the final rule implementing the Organic Foods Production Act.
“We are writing to urge the USDA to establish a simple, cost-effective, cost-share program for organic small farmers in order to offset the costs of organic certification and encourage the participation of more farmers in the organic certification program,” the committee said in a formal request containing sign-ons from a long list of individuals and organizations. “There are currently many models in effect in the United States, including a new one in Minnesota.”
The agency turned down this request. The NOP staff, including supervisor Barbara Robinson, also has consistently had a poor attitude toward cost share payments and would like to get rid of the job of administering the 35-state program. The head of the marketing agency with overall responsibility for the NOP, on the other hand, appears to have a more favorable view. Lloyd Day, administrator of the Agricultural Marketing Service, praised the cost share approach as recently as last summer.
“The feedback we’ve received from organic producers about the cost share program has been very positive,” Day noted in an Aug. 15 AMS press release announcing the availability of another $1 million for the separate 15-state program in 2007. “We’re glad we can announce that this program is continuing into its sixth year.”
The National Campaign’s organic committee has cited the cost of certification, especially for smaller operations, as an impediment to entry into the organic program. Organic farmers, it adds, are in a unique position in that they bear the costs of implementing environmentally sound farming practices at the same time they have to pay fees to verify that they comply with federal standards. The committee also has emphasized that these costs are not confined to initial certification.
“On the contrary, the ongoing costs and burden of maintaining organic certification are often cited by small and medium sized producers as one of the frustrations with the National Organic Program,” the committee notes in a cost-share fact sheet. “An ongoing cost-share program to help defray these costs for initial certification as well as annual re-certification is crucial to ensuring the continued diversity in scale of organic farms and handling operations.”
Restoring the Program for 2008 and Beyond
The likelihood that cost-share funding will be restored for 2008 through a provision in the 2007 farm bill appears to be good. Supporters contend the appropriations meltdown that allows the program to lapse in 2006 may make getting it going again more difficult. But it also should help rally broad organic community support and cooperation needed to get it restored.
Organic farming advocates have been working for months on a new farm bill proposal that would provide up to $25 million over five years. Some disagreements about funding levels and other specific details remain to be ironed out. But in general this proposal appears to have the support of the National Organic Coalition, the Organic Trade Association, the Campaign for Sustainable Agriculture, and the Sustainable Agriculture Coalition. It is estimated that this would cover funding in the 35 states for as many as 12,500 certified farmers and handlers by the end of the 5-year period.
In addition to trying to reach agreement on a proposed cost share funding level, supporters also need to convince Congress to agree on changes that will eliminate sloppy state and federal recordkeeping and reporting. The NOP should be required to keep accurate, accessible, and up-to-date records of requests and disbursements from the program, supporters contend, as well as requiring accurate and consistent recordkeeping from the states receiving program payments.
At a time when billions of dollars are sloshing around in a Washington sea of waste and political corruption, it does not seem too much to ask that $25 million be provided for five years of cost-share funding for organic farmers who follow the federal rules. It is time for the organic community to raise its sights and unite in a campaign to obtain a nationwide, rather than a 35-state, cost-share program and to have it fully funded without having to go through the arcane pay-to-play appropriations process.
It also is time to try to identify a Congressional champion in each house of Congress who will make sure this minuscule program, and others needed by organic farmers, are funded and protected. Surely Senator Tom Harkin or Patrick Leahy or Representative Sam Farr or Ron Kind, all regarded as reliable organic supporters, can be persuaded to rise to the occasion and provide the leadership and spend the political capital necessary to make sure this is done.
by Roger Blobaum
This article was first printed in the January, 2007 issue of the Organic Broadcaster, published by the Midwest Organic and Sustainable Education Service