Summary of Key H.R. 2 (Farm Bill) Provisions

The NCC prepared a summary of select provisions of the Agriculture and Nutrition Act of 2018 (H.R. 2) which was approved by the House Agriculture Committee on April 18.

Published: April 20, 2018
Updated: April 20, 2018

Agriculture and Nutrition Act of 2018 (H.R. 2)

House Agriculture Committee

Committee Approved Farm Bill

Summary of Select Provisions

Title I – Commodities

Agriculture Risk Coverage/Price Loss Coverage (ARC/PLC)

  • Continues the ARC-County and PLC programs with current reference prices – $0.367/lb for seed cotton
  • Includes a reference price escalator provision based on 85% of the 5-year Olympic average of marketing year average (MYA) prices, not to exceed 115% of the reference price
  • One time, crop by crop election between ARC and PLC for the 2019 through 2023 crop years
  • Eliminates the ARC-Individual coverage option
  • Unplanted base acres:  farms with base acres and no covered commodity planted or prevented planting at any point from 2009 through 2017, the base acres become unassigned and ineligible for any ARC/PLC payments
  • Drought triggered payment yield update:  farms in counties with a D4 drought declaration for 20 or more consecutive weeks during 2008 through 2012 are eligible to update payment yields based on 90% of the farm’s average yields for the 2013 through 2017 crop years for the years the crop was planted.  Includes option to use a yield plug for any years based on 75% of the county average yield for the 2013 through 2017 crop years.

Marketing Loan Program

  • Non-recourse marketing loan program continued with current loan rates
  • Upland cotton loan rate based on 2-year moving average of the AWP, not to exceed $0.52/lb or less than $0.45/lb, and the loan rate decline in any given year is limited to 2% of the previous year’s loan rate
  • Extra Long Staple (ELS) cotton loan rate increased to $0.95/lb and the ELS Competitiveness Program is adjusted to align the current 134% of loan rate trigger to the new loan rate level by reducing the trigger to 113% of the higher loan rate

Payment Limits and Program Eligibility

  • Continues current $125,000 per person payment limit for ARC/PLC payments; no longer applies to marketing loan benefits; maintains separate $125,000 limit for peanuts
  • Continues availability of commodity marketing certificates
  • Continues current adjusted gross income (AGI) test of $900,000 per person
  • Broadens definition of family member for actively engaged determination for program eligibility to include nieces, nephews and first cousins.
  • Applies the payment limit and AGI to each individual in a pass-through entity (S corp, LLC) rather than the entity itself (i.e. treats pass-through entities like general partnerships and joint ventures)

Textile Provisions

  • Economic Adjustment Assistance Program (EAAP) continued with payment rate increased from $0.03/lb to $0.0315/lb
  • Pima Trust Fund continued with updated eligibility criteria to allow participation based on previous year and current year use of Pima cotton.  Funded at $8 million per year instead of the current $16 million per year (program has no budget baseline)

Title II – Conservation

Conservation Reserve Program (CRP)

  • Increases acreage limitation by 1 million acres per year for life of the bill; reaching 29 million in 2023
  • Acreage increases by state will be based on the state’s historical enrollment
  • Contracts are 10 to 15 years for general sign up and 15 to 30 years for continuous sign up
  • Caps rental rates at 80% of NASS county average and requires NASS to calculate rental rates every year
  • Reduces cost share payments to not more than 40% of the cost and caps seed cost share at not more than 25% of the cost of the seed mixture
  • Reduces rental payments by 10% for each subsequent reenrollment

Environmental Quality Incentives Program (EQIP)

  • Increases funding to more than $3 billion by 2023
  • Merges the traditional EQIP program with CSP
  • Retains most, if not all, current enhancements in CSP along with the benefits of bundling complimentary practices including a new water conservation or irrigation efficiency practice
  • Allows producers to address one specific resource concern
  • Provides producers the flexibility to prioritize work on a part of their operation, cutting down on complications with different landowners or different landscapes
  • Targets program delivery to locally-identified resource concerns
  • Removes the 60% livestock carve out but retains that no less than 5% must go to wildlife practices
  • Allows irrigation districts, irrigation associations, and acequias to be eligible for EQIP
  • Authorizes precision conservation management planning as a cost-share practice under Conservation Activity Plans developed by third-party technical service providers
  • Continues $450,000 payment limit for all contracts during 5 year term of farm bill

 Conservation Stewardship Program (CSP)

  • Eliminates CSP while consolidating major aspects of the program into EQIP
  • Current contracts are honored, but no reenrollments will occur

Regional Conservation Partnership Program (RCPP)

  • Funded at $250 million per year in mandatory funds instead of using donor programs
  • Simplifies the application process

Agriculture Conservation Easement Program (ACEP)

  • Funded at $500 million per year
  • Removes Adjusted Gross Income test for program eligibility

Title III – Trade

  • Creates an International Market Development Program that combines the current Market Access Program (MAP), Foreign Market Development program (FMD), Emerging Markets Program (EMP), and Technical Assistance for Specialty Crops (TASC).
  • Funded at $255 million annually with funds allocated to individual programs based on current funding levels (i.e. $200 million for MAP and $34.5 million for FMD)

Title V – Credit

  • Increases the loan limit for USDA guaranteed farm ownership and farm operating loans from $700,000 to $1,750,000, adjusted for inflation

Title VII – Research and Extension

  • USDA’s Office of Pest Management Policy will continue funding of $3 million annually
  • Foundation for Food and Agriculture Research not reauthorized

Title IX – Horticulture

Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA)

  • Clarifies the role of State Lead Agencies that are charged with implementing EPA regulations and gives them an opportunity to consult with EPA when they propose new regulations
  • Reconciles FIFRA and Endangered Species Act (ESA) to give EPA expressed authority to ensure the protection of endangered species in connection with pesticide use.  Fish and Wildlife Service and National Marine Fisheries Services (The Services) would no longer have main authority.
  • Includes the Pesticide Registration Improvement Act (PRIA-4) – reauthorize program for pesticide manufacturers/registrants to pay registration fees for pesticide registration review applications to help fund EPA’s pesticide reviews and registrations in a timely manner

Clean Water Act (CWA)

  • Eliminates the requirement of a National Pollutant Discharge Elimination System (NPDES) permit under the Clean Water Act for pesticides that are already approved under FIFRA

Title X – Crop Insurance

Stacked Income Protection Plan (STAX)

  • Continues STAX for cotton, but only available on farms with no seed cotton base acres or on farms with seed cotton base acres that are not enrolled in ARC/PLC for that crop year

Supplemental Coverage Option (SCO)

  • Continues SCO, but includes a limitation that SCO, margin basis policies, and area yield and loss policies cannot be purchased on acres enrolled in ARC, or with STAX coverage

Catastrophic Coverage (CAT)

  • Increases CAT administrative fee from $300 to $500 annually per crop

Actual Production History (APH)

  • Codifies current regulations that limit the single-year drop in APH to 10%

Maintenance of Policies

  • Addresses concerns with reimbursements for policies developed under the 508(h) process as well as continues Board authority to approve maintenance fees.  Clarifies under what situation the Board can disapprove such fees.

Research and Development Priorities

  • Requires research and development on losses due to tropical storms and hurricanes, subsurface irrigation and alternative methods for adjusting quality losses.  Also changes the definition of beginning farmer and rancher from 5 years to 10 years for Whole Farm Revenue policies.