The White House and congressional leaders are expected to resume negotiations over the size of the FY11 funding bill during the week of March 14 after test votes in the Senate demonstrated that neither the House Republican plan to deeply cut spending (H.R. 1) nor a Senate Democratic alternative had enough support to become law.
Senate Majority Leader Reid (D-NV) said the two votes were necessary to move the negotiations over FY11 spending ahead. However, no one expects a final agreement to be reached before the current short-term funding bill expires on March 18. In its series of votes, the Senate first rejected H.R. 1, which would reduce FY11 non-defense discretionary spending in FY11 by about $64.0 billion compared to FY10.
A Democratic alternative developed by Senate Appropriations Committee Chairman Inouye (D-HI) would provide about $51 billion more than the House bill. Congress and the White House have to make a decision on what action to take in the short-term to keep the federal government open because the current short-term funding measure expires on March 18.
Reportedly, House Republican appropriators are moving ahead with another short-term continuing resolution (CR). The new bill is expected to be made public on March 11 and is expected to cover three weeks of government operations. The House is expected to take it up and pass it on March 15. The measure would cut about $2 billion a week from current spending levels in accordance with the Republican insistence that even short-term bills include spending cuts.
Hope for progress on a broad spending agreement now rests firmly on White House-led negotiations with congressional leaders. While the debate over a short-term FY11 spending bill continues, House Republicans expect to begin work on the congressional budget outline for FY12 in April.
“It is our intent to advance a budget in April,” said Conor Sweeney, a spokesman for Rep. Ryan (R-WI), chairman of the House Budget Committee.
Floor action by mid-April appears to be a likely target.
Sen. Conrad (D-ND), the chairman of the Senate Budget Committee, has yet to announce a time line for a budget resolution. Under the Congressional Budget Act, the Senate is to adopt its resolution by April 1, and the House and the Senate are to have resolved their differences and agreed on a conference report on the budget resolution by April 15. However, the timeframe rarely has been met and there are no penalties for missing it. A more significant deadline is May 15, the date after which appropriations bills can be considered on the House floor even without a budget resolution and the annual spending caps that are usually contained in it.
1099 Bill Amendment Planned
Finance Committee Chairman Baucus (D-MT) said he intends to amend the House-passed bill (H.R. 4) to repeal new Form 1099 rules by paying for the bill with a combination of the House and Senate offsets. A key concern to moving the bill forward is how to pay for its $24.7 billion cost.
Senate Majority Leader Reid (D-NV) announced he has postponed plans to bring the bill to repeal new Form 1099 rules to the Senate floor after Democrats were unable to reach agreement on the bill over concern about the offsets used to pay for the bill.
The House bill was paid for with a provision that would modify repayments of health care tax credit overpayments.
The Senate paid for the repeal by rescinding $44 billion of unspent earmarks. The bill, which would relieve businesses of the requirement to file a Form 1099 information report whenever their payments to a single provider of a good reaches $600 in a single year, is expected to move to the Senate floor soon. The bill also would repeal a new requirement for landlords to report all payments of $600 or more for goods or services provided for rental property. The repeal would apply only to new Form 1099 requirements put in place under the Patient Protection and Affordable Care Act of 2010 and the Small Business Jobs Act of 2010.
Panel Reports Favorably On Pesticide Permit Bill
The House Committee on Agriculture held a markup on the Reducing Regulatory Burdens Act of 2011 (H.R. 872). The bill will amend the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) and the Clean Water Act (CWA) to exempt pesticides used according to the label from the need for CWA permits.
H.R. 872 is a response to a Sixth Circuit Court of Appeals ruling which vacated a 2006 EPA rule that exempted pesticides applied near, over, or into waters of the United States from National Pollutant Discharge Elimination System (NPDES) permits under the CWA if those pesticides were applied in accordance with the FIFRA label. The court’s broad ruling mandated, for the first time, that pesticide applications be permitted under the CWA.
The court granted a two-year stay of its mandate until April 9, ’11. EPA has not yet issued a final permit and recently asked the court for a further delay until Oct. 31, ’11.
Most members of the House Agriculture Committee are co-sponsors of the bill. No amendments were offered and the sections of the bill dealing with FIFRA were reported out unanimously by voice vote. The House Committee on Transportation and Infrastructure has jurisdiction over the CWA and is planning a markup for next week.
The NCC issued an Action Alert to its directors, national interest organizations, producer and ginner interest organizations, and Environmental Task Force – encouraging them to contact Cotton Belt Representatives and urge them to co-sponsor, if they already have not, or support H.R. 872. Congressional contacts can be found on the NCC’s website, www.cotton.org.
Jackson Questioned on EPA Actions
The House Committee on Agriculture held a hearing with EPA Administrator Lisa Jackson as the sole witness. The hearing’s purpose was to question Administrator Jackson on the impact of EPA actions and policies regarding agriculture.
Chairman Lucas (R-OK), in his opening statement, mentioned the issues of spray drift, atrazine, NPDES permits and endangered species consultations. He stated that the Committee would be watching EPA actions to see if they are following statutory authority, using sound science and conducting cost/benefit analyses.
Ranking Member Peterson (D-MN) stated that EPA regulations were of top concerns for farmers across the country. He continued to voice his concerns about the tendency for EPA to go into settlement agreements in lawsuits filed against the Agency. Settlement agreements often are made between EPA and the environmental litigants.
In her opening statement, Jackson said she wished “to dispel certain myths about EPA’s work and its impact on agriculture. These mischaracterizations are more than simple distractions; they prevent real dialogue to address our greatest problems.”
The mood of the meeting was stern as members of both parties threw out pointed and direct questions about EPA issues that affect their respective districts. Rep. Peterson continued his questioning about litigation settlements and asked how EPA decides to do so. Rep. Cardoza (D-CA) even asked the Administrator if she or any of her staff actually encouraged, or cooperated in, any environmental lawsuits. Jackson replied that she was not aware of such activity and that it would be unethical.
Jackson said, “Everyone in this room has the same desire – to have safe water, air and land for our children – and to do so in a way that maintains our economic strengths. EPA will continue to work with this committee, as well as our partners in the States and the agricultural community to achieve the goals we have set together, and to serve the values we all share.”
Panel Moving on Greenhouse Gases Bill
House Energy and Commerce Committee Republicans plan to move forward with a vote on Chairman Upton’s (R-MI) bill to block EPA regulation of greenhouse gases, despite Ranking Member Waxman’s (D-CA) offer to wipe the slate clean and cooperate on comprehensive energy legislation.
“I am prepared to meet with you without any preconditions, for as long as it takes, to find a basis for common ground,” said Rep. Waxman, who sponsored a House-passed comprehensive cap-and-trade bill in the last Congress. “We need to find a way to work across party lines to address this threat to our health, our economic prosperity and our national security.”
Rep. Waxman’s offer assumes that Republicans accept the scientific view that man-made global warming poses a threat, a position that several GOP committee members are on record as rejecting or doubting.
Rep. Waxman and the Democrats pushed for a hearing on the science of climate change with the aim of focusing the debate about EPA climate regulation on the science. Republicans on the Energy and Power Subcommittee were determined, in turn, to frame the discussion around the economic costs of the EPA regulation. At the hearing, six of the seven scientists called global warming a real phenomenon, though two invited by Republicans to testify questioned the extent to which human activity and greenhouse gases are to blame.
Meanwhile, multiple bills have been introduced into both chambers of Congress: H.R. 97 by Rep. Blackburn (R-TN) would amend the Clean Air Act to prevent the law from being used to regulate greenhouse gases; H.R. 153 by Rep. Poe (R-TX) would prohibit funding for the EPA that would be used to implement or enforce a cap-and-trade program for greenhouse gases; H.R. 199 by Rep. Capito (R-WV) would suspend for two years any EPA action regarding carbon dioxide or methane under the Clean Air Act, other than with respect to motor vehicle emissions; H.R. 910 by Rep. Upton (R-MI) would prohibit the EPA from regulating greenhouse gases under the Clean Air Act, with the exception of motor vehicle emissions; S. 15 by Sen. Vitter (R-LA) would block carbon dioxide regulation until China, India and Russia set similar emissions limits; S. 228 by Sen. Barrasso (R-WY) would pre-empt regulation of greenhouse gases under federal and common law should a federal policy to mitigate climate change be enacted; S. 231 by Sen. Rockefeller (D-WV), the Senate version of the Capito bill; and a draft Senate bill bySen. Inhoffe (R-OK), Senate version of the Upton bill.
’10-11 US Production, Mill Use, Exports Unchanged
In its March report, USDA projected the ’10-11 US cotton crop to be 18.32 million bales, unchanged from the February report. Both US mill use and exports were unchanged at 3.60 million bales and 15.75 million bales, respectively. This generates a total ’10-11 offtake of 19.35 million bales. Ending stocks for ’10-11 are projected to be 1.90 million bales for an ending stocks-to-use ratio of 9.8%.
USDA released ’11-12 projections during last month’s Agricultural Outlook Forum. US cotton production is estimated to be 19.50 million bales for ’11-12. Mill use is set at 3.50 million bales while exports are reported to drop slightly to 15.00 million bales. The estimated total offtake stands at 18.50 million bales. With beginning stocks of 1.90 million bales, this would result in US ending stocks of 2.90 million bales on July 31, ’12, and a stocks-to-use ratio of 15.7%.
The USDA March report lowered ’10-11 world production by 300,000 bales from the February report to 114.95 million bales. World mill use was increased 60,000 bales to a projected 116.61 million bales. Consequently, world ending stocks for ’10-11 are projected to be 42.33 million bales for a stocks-to-use ratio of 36.3%.
USDA released ’11-12 world projections during last month’s Agricultural Outlook Forum. World production is estimated at 127.50 million bales for the ’11-12 crop year. Mill use is set at 120.00 million bales. With beginning stocks of 42.33 million bales, this would result in world ending stocks of 49.83 million bales on July 31, ’12, and a stocks-to-use ratio of 41.5%.
Sales Steady, Shipments Surge
Net export sales for the week ending March 3 were 90,800 bales (480-lb). This brings total ’10-11 sales to approximately 15.6 million bales. Total sales at the same point in the ’09-10 marketing year were approximately 9.6 million bales. Total new crop (’11-12) sales are 4.2 million bales.
Shipments for the week were 516,300 bales, bringing total exports to date to 8.2 million bales, compared with the 5.8 million bales at the comparable point in the ’09-10 marketing year.
Effective March 11-17, ’11
Adjusted World Price, SLM 11/16
219.48 cents
*
Fine Count Adjustment ('09 Crop)
1.55 cents
Fine Count Adjustment ('10 Crop)
1.65 cents
Coarse Count Adjustment
0.00 cents
Marketing Loan Gain Value
0.00 cents
Import Quotas Open
0
Special Import Quota (480-lb bales)
0
ELS Payment Rate
0.00 cents
*No Adjustment Made Under Step I
Five-Day Average
Current 5 Lowest 3135 CFR Far East
236.32 cents
Forward 5 Lowest 3135 CFR Far East
147.68 cents
Coarse Count CFR Far East
NA
Current US CFR Far East
233.35 cents
Forward US CFR Far East
147.00 cents
'10-11 Weighted Marketing-Year Average Farm Price
Year-to-Date (Aug.-Jan.)
80.47 cents
**
**August-July average price used in determination of counter-cyclical payment
