U.S. House Agriculture Chairman Mike Conaway updated the farm press this past week on key legislative efforts, including the farm bill and tax reform legislation.
Tax reform took another big step forward with the House GOP passing 216 to 212, a Senate budget that will allow the Senate GOP to pass a tax bill without any Democrats. Some 20 House Republicans voted ‘no’ on the budget.
Tax and budget action will play a role in setting the farm bill schedule and framework, according to House Agriculture Chairman Mike Conaway…
“The Senate’s budget getting passed, and us then moving forward. Now, there is a question mark that’s been eliminated and that was the mandatory spending cuts in the House version, those have gone away now, for the time being, so we’ll be able to move forward with the farm bill without having to take into consideration what we might have to or not have to do with respect to that issue.
“Still on track for late fourth quarter, early first quarter of next year to make that happen. Obviously, November looks like it is going to be consumed by tax reform.”
Conaway says ending the estate tax is the most important part for agriculture, along with tax simplification and immediate deductibility of expenses.
Conaway, meantime, is reluctant to predict how the Agriculture Committee will handle any one farm bill program, like the popular CRP, until the Congressional Budget Office certifies available spending figures.
But he says one critical issue that will take more than just basic math is crop insurance. Conaway says the GAO and insurance industries need to ‘get on the same page’ in figuring out insurer profitability…
“Bottom line, if this was so lucrative, instead of having consolidations we’d be having new people coming in saying ‘hey, we want a piece of that market’, because it is more lucrative than it is in other places out there. Until we can get a better feel for what GAO decides is their rate of return computation and the insurance industry says their rate of return is and compare those and see where those difference are, it’s really just meaningless conversation.”
The GAO has produced differing assessments of crop insurer profitability, key to perennial farm bill arguments over whether insurance subsidies can be pared. House and Senate farm leaders adamantly oppose cuts to crop insurance, now protected with other farm bill programs by a Senate budget amendment.