That is the Grassley Amendment that would limit payments to individual farmers to $225,000 per year ﷓ $275,000 if the wife participates in the operation – eliminate the three-entity rule and render generic commodity certificates ineffective. It would also introduce “means testing” to farm programs.

Before the Senate voted, the National Cotton Council sent a letter to senators saying that including the amendment in the final farm bill would mean that the majority of U.S. cotton producers cannot survive.

House Agriculture Committee Chairman Larry Combest, who has said he opposes the Grassley Amendment, said he had directed that working meetings begin immediately without waiting for the formal announcement of members of the House-Senate conference committee.

The House passed its farm bill, the “Farm Security Act” (HR 2646) by a two-to-one margin, 291 to 120, back on Oct. 5. Since then, Combest and Rep. Charles Stenholm, ranking Democrat on the House Ag Committee, have frequently called for the Senate to pass a new farm bill in time for the 2002 planting season.

While the House has not announced its conferees, Combest will likely lead the House representation because of his position as chairman of the House Ag Committee. Stenholm would be the principal Democratic member.

Sources said the Senate leadership plans to name four Democrats and three Republicans to the conference committee, reflecting the Democrats’ one-vote majority in the Senate. The Republicans will be Senators Jesse Helms of North Carolina, Thad Cochran of Mississippi and Richard Lugar of Indiana.

Cochran spoke against the Grassley Amendment during the floor debate on the Senate farm bill, saying it would have “catastrophic consequences for the South.”

Besides Sen. Tom Harkin, chairman of the Senate Agriculture Committee and author of the Senate farm bill, the Democrats on the Senate side will be Senate Majority Leader Tom Daschle from South Dakota, Sen. Patrick Leahy of Vermont and Sen. Kent Conrad of North Dakota.

While payment limits will occupy much of the attention of farm organizations, conference committee members will have to resolve other issues before they can send a report to the House and Senate for a vote and to the president for his signature.

Agriculture Secretary Ann Veneman said the Bush administration believes the conference committee must make several revisions before the president will sign a bill.

“While Senators reached consensus on some titles of the farm bill, there are many areas where the bill misses the mark,” she said in a statement issued after the Senate vote. “Of particular concern is the Senate bill front-loads spending in the first five years, leaving farm programs shortchanged in the long-term.

“This will simply hurt farmers down the road. The House-passed bill spreads the funding much more evenly over a 10-year period.”

In recent days, the president has said a new farm bill must provide a responsible safety net; promote expanded trade, encourage improved conservation, establish farm savings accounts and adhere to the budget agreement.

“We particularly appreciated the efforts by Senators Cochran and Roberts in introducing an amendment that met these principles,” she said, referring to legislation introduced by Cochran and Sen. Pat Roberts of Kansas before the Senate adjourned in December.

While that amendment was not introduced during the debate since the Senate returned to work, Cochran has indicated he will try to include the language in the final conference report. The legislation features higher Agricultural Market Transition Act payments for the program crops and soybeans and matching funds for farmer savings accounts.

Under the Grassley amendment, farmers would face limits of $75,000 for a combination of fixed or AMTA and counter-cyclical payments per farmer or $125,000 for a husband and wife team and $150,000 for combined marketing loan gains and loan deficiency payments.

Once the marketing loan limit is reached, according to a National Cotton Council analysis of the amendment, all outstanding loans would convert to recourse loans, meaning that farmers would be required to repay CCC loans rather than being allowed to forfeit the collateral to the government.

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