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The 2018 Farm Bill Highlights

For More Information

Contact: Bob Kjelland  bob.kjelland@rmfu.org

Phone: 970-397-0039


Click on the following link to learn the details on the 2018 Farm Bill.

2018 Farm Bill Summary R


Price Loss Coverage (PLC) and Agriculture Risk Coverage (ARC) programs.

• Farmers will be able to make an election between ARC and PLC in 2019 for the 2019 and 2020 crop years. Starting in 2021, farmers will be allowed to make a choice between the programs on an annual basis. (Sec. 1105)

• The bill allows farmers a one-time opportunity to update their payment yields based on their average yield per planted acre between 2013 and 2017, and the update would take effect for payments in the 2020 crop year. (Sec. 1103)
o This update is for farmers nationwide instead of the language in the House version, which would have only applied to counties that had been affected by severe drought.
o The five-year average yield is multiplied by a detrending factor before being applied.

• The bill improves ARC-County by replacing especially low county yields with a value equal to 80 percent of the county yield over the previous five years. ARC-County yields are now subject to a trend-adjusted yield factor, as is used in crop insurance policies. (Sec. 1107)
o The use of a higher transitional yield and a trend-adjusted factor will increase the level of protection offered by ARC-County and will likely smooth out disparities in payment rates between counties.

• PLC reference prices are unchanged, except for an adjustment for temperate japonica rice. (Sec. 1106 (3)) The bill also provides for up to a 15 percent increase in PLC reference prices – known as an effective reference price – if a covered commodity’s market price remains high for multiple years. (Sec. 1101)
o The effective reference price will also be used in calculating the ARC guarantee.

• The bill prioritizes the use of data from the Risk Management Agency (RMA) for calculating county yields in the ARC-County program. (Sec. 1107 (5)) Additionally, the bill requires USDA to report the payment rate for each county no later than 30 days after the end of the marketing year for each covered commodity. (Sec. 1107 (2))
o The use of actual yield data, as collected by RMA, will improve confidence in the accuracy of ARC-County yield calculations, and the expedited publication of payment rates will provide farmers with more information about expected program payments.

• ARC-Individual is preserved, and a limited pilot program will be established for splitting very large counties into administrative units upon the request of the state Farm Service Agency and county committee. (Sec. 1107)
• Base acres on farms that were planted entirely in grass and pasture from 2009 to 2017 are ineligible for ARC and PLC payments for crop years 2019 to 2023. (Sec. 1102 (b)) These acres may be enrolled in the Conservation Stewardship Program grasslands initiative. (Sec. 2309)
o This is a notable departure from the House-passed bill, which would have converted the unplanted base acres to “unassigned” indefinitely.

The bill raises marketing loan rates.

Marketing Loan Rates (Sec. 1202 & 1301)
Commodity Current New
Corn $ 1.95 bu. $ 2.20 bu.
Soybeans $ 5.00 bu. $ 6.20 bu.
Wheat $ 2.94 bu. $ 3.38 bu.
Sorghum $ 1.95 bu. $ 2.20 bu.
Barley $ 1.95 bu. $ 2.50 bu.
Oats $ 1.39 bu. $ 2.00 bu.
Minor Oilseeds $ 10.09 cwt. $ 10.09 cwt.
Upland Cotton $ 0.45 – 0.52 $ 0.45 – 0.52*
ELS Cotton $ 0.80 lb. $ 0.95 lb.
Peanuts $ 355 ton $ 355 ton
Rice $ 6.50 cwt. $ 7.00 cwt.
Lentils $ 11.28 cwt. $ 13.00 cwt.
Dry Peas $ 5.40 cwt. $ 6.15 cwt.
Large Chickpeas $ 11.28 cwt. $ 14.00 cwt.
Small Chickpeas $ 7.43 cwt. $ 10.00 cwt.
Sugarcane $ 0.1875 lb. $ 0.1975 lb.
Sugar Beets $ 0.2409 lb. $ 0.2538 lb

Disaster programs are continued with some modifications.
• Additional causes of loss are eligible for assistance for Livestock Indemnity Payments, including disease outbreaks that cannot be prevented by immunization as well as losses of unweaned livestock due to cold temperatures. (Sec. 1501 (b))
• The payment limit is removed for the Tree Assistance Program. (Sec 1501 (d))

Noninsured Crop Assistance Program (NAP) is continued and moved from the miscellaneous title into Title I.
• Payment limits for NAP are increased: for catastrophic coverage, the payment limit is set at $125,000 per year, and the limit for additional buy-up coverage is $300,000 per year. (Sec. 1601)
• The service fee for NAP is raised to $325 per crop, $825 per producer per county, but not to exceed a total of $1,875 per producer. (Sec. 1601)
o The cost of the higher payment limits is offset by the savings from the increased service fees.

Payment limit and eligibility requirements
• The adjusted gross income (AGI) eligibility threshold remains at $900,000 per year.
• The cumulative payment limit for ARC and PLC remains set at $125,000 per individual or $250,000 per married couple.
• The payment limit is eliminated for loan deficiency payments and marketing loan gains. (Sec. 1703).
• The definition of “family member” for purposes of payment limitations is expanded to include first cousins and nieces and nephews. (Sec. 1703)
• Payment limits and AGI restrictions may be waived by USDA for payments made to conserve environmentally sensitive land. (Sec. 1704)

Multiproducer Registration: Streamlines sign up for operations with multiple owners. This issue is especially important to operations with many owners.

Livestock Gross Margin Insurance: Completely removes the restriction between LGM and FSA dairy programs. Producers will be able to use DMC and LGM without restriction on the same milk.

Retroactive LGM Participation: Allows producers who were locked of the improved 2018 Margin Protection Program (MPP) due to LGM participation to retroactively participate in MPP for the months in 2018 in which they were exclude from participation.

Production History: Ends annual national production history updates as proposed similarly in the House and Senate bills. This section provides for equitable treatment for newly-participating dairies and disallows the changing of business structure solely for updating production history.

Coverage Percentage: Allows operations to cover between five percent and ninety-five percent of production history. Previously under MPP, producers could only cover between twenty-five and ninety percent.

Coverage Levels: Allows operations to cover margins between $4.00 and $9.50 in fifty-cent increments for their first five million pounds of participating production. Previously under MPP, there were no options at $8.50, $9.00, or $9.50. Operations enrolling more than five million pounds can cover margins between $4.00 and $8.00. Operations choosing $8.50, $9.00, or $9.50 coverage in the first tier can choose any second coverage level in their second tier.

Producer Premiums: Establishes the premium rates in the table apply per covered hundredweight per year. The Conference Report includes a much cheaper $9 coverage option at $0.11/cwt compared to the House bill ($0.17/cwt) or the Senate bill ($0.18/cwt). The report also establishes a coverage option at $9.50 and makes the price of $4.50 and $5.00 coverage uniform across tiers, reducing the cost of $5 coverage for operations covering

Reauthorizations: Reauthorizes forward pricing, the Dairy Indemnity Program, and certain promotion and research authorities through 2023

Conservation Reserve Program
Increases CRP acreage to 27 million acres by FY2023. Limits rental payments to 85% of the estimated county average rental rate for general sign-up and 90% of the estimated county average rental rate for continuous sign-up. Limits cost-share for seed costs to 50 percent of the actual cost of the seed mixture. Limits practice incentive payments (PIPs) to 50 percent of the cost of establishing measures and practices. Limits signing incentive payments (SIPs) to 32.5% of the amount of the first annual rental payment. Designates priority for continuous contracts that address water quality (“CLEAR”). Increases continuous acreage to 8.6 million acres by 2022. Authorizes the Secretary to enter into an agreement with eligible partners to carry out the Conservation Reserve Enhancement Program. Expands haying and grazing allowances and clarifies emergency haying and grazing designations. Allows organic certification process to begin 3 years prior to the expiration of a CRP contract.
Increases CRP-Grasslands acreage to 2 million acres by 2021. Grants priority to grasslands contracts that provide habitat for endangered species.
CRP Pilots
Establishes a pilot program for 30-year water quality contracts (“CLEAR 30”). Establishes a Soil Health Income Protection Program pilot and authorizes up to 50,000 total acres.
CRP-Transition Incentive Program
Increases funding to $50 million over five years. Expands eligibility to any CRP contract holder. Expands transition period for conservation and land improvements to 2 years. Allows transition incentives for shorter (5-year) leases. Gives priority to lessee for enrollment in EQIP, CSP or ACEP.
Environmental Quality Incentives Program
Increases funding to $2.025 billion by FY2023. Establishes a Conservation Planning Assessment. Allows states to designate up to 10 high-priority practices to be eligible for increased payments. Reduces livestock set-aside to 50 percent and increases wildlife set-aside to 10 percent. Establishes new EQIP Conservation Incentive Contracts that allow for 5-10 year contracts. Conservation Incentive Contracts must address at least 1 priority resource concern and include adoption, maintenance and improvement of incentive practices. Allows irrigation districts to be eligible for water conservation or irrigation efficiency practices. Increases EQIP Organic Initiative payments to $20,000 per year. Increases air quality set-aside to $37.5 million and establishes new set-aside for on-farm conservation innovation trials. Requires a report every two years on funding distributions, economic and environmental outcomes of practices, and provides recommendations for new and effective conservation practices.
Conservation Stewardship Program
Reestablishes CSP as new program under one Chapter with EQIP. Existing CSP contracts will be honored and those expiring on or before December 31, 2019 will be eligible for a one-year extension. Monetizes CSP in lieu of using the existing acreage-based framework. Authorizes funding of $700 million in FY2019 and increases funding to $1 billion by FY2023. Expands eligible activities to include comprehensive conservation plan and activities to adapt to, or mitigate against, increasing weather volatility. More clearly defines basis for stewardship threshold determination. Does not allow for automatic renewals but multiple renewals will be allowed when criteria are met. Expands supplemental payments to include advanced grazing management and clarifies that supplemental payments must be at least 150% of the annual payment amount. Adds bonus payment for cover crop activities. Improves streamlining and coordination between CSP and EQIP.
Grassland Conservation Initiative
Establishes a new Grassland Conservation Initiative to provide one-time, 5-year contracts to preserve grazing uses and improve soil, water, and wildlife conservation. Annual payments will not exceed $18 per acre and land enrolled in the Initiative will be considered to be planted to a covered commodity. Provision was included as a compromise for base acre changes for grasslands in Title I.
Emergency Conservation Program
Reserves 25% of funds for the repair or replacement of fencing. Sets the cost-share rate at no more than 75 percent of the total allowable cost. Sets a payment limit of $500,000.
Agricultural Conservation Easement Program
Increases funding to $450 million for each fiscal year. Allows land easements to be used for buy-protect-sell transactions. Expands permissible forms of non-Federal share. Expands flexibility on wetland reserve easements.

Regional Conservation Partnership Program
Increases funding to $300 million for each fiscal year. Eliminates the percentage of funds taken from CSP, EQIP and ACEP. Adds CRP and Watershed Protection and Flood Prevention Program as covered programs. Expands the eligible activities and eligible land. Expands eligible partners to include acequias, irrigation districts and conservation districts. Authorizes new grant agreements. Eliminates set-aside for a national competitive process and provides 50% of total funding for state or multistate projects and projects in critical conservation areas.

Trade Promotion, Development, and Assistance
Consolidates the Market Access Program, Foreign Market Development Cooperator Program, the E. (Kika) De La Garza Agricultural Fellowship Program, and Technical Assistance for Specialty Crops under one Agricultural Trade Promotion and Facilitation section. Provides $255 million in in annual mandatory funding with not less than $200 million for MAP, not less than $34.5 million for FMD, and not more than $8 million annually for EMP. TASC is funded at $9 million annually and the Priority Trade Fund at $3.5 million annually.

Supplemental Nutrition Assistance Program
Reauthorizes SNAP while retaining the general work requirement and able-bodied adult without dependents (ABAWD) work requirement in current law. The bill makes modest changes to program integrity and administration. The agreement also focuses on encouraging the improved use of State Employment and Training (E&T) programs for SNAP recipients to gain and retain employment.
The conference report recognizes that acceptance of SNAP benefits at farmers markets has increased participants’ access to fresh, healthy food while improving sales for local farmers, though SNAP acceptance at farmers markets has been a challenge due to cost and availability of wireless Electronic Benefit Transfer (EBT) point-of-sale equipment. The report directs USDA to take appropriate action to ensure that EBT service is not disrupted and SNAP customers maintain the ability to use their benefits at farmers markets. The report also notes that it intends USDA to allow a farmers market or direct-marketing farmer to operate an individual point-of-sale device at more than one location under the same SNAP authorization, rather than requiring each farmers market location to have its own EBT authorization and equipment.

Emergency Food Assistance Program
Increases the Emergency Food Assistance Program (TEFAP) entitlement commodity funding by extending funding authority at $250 million per year through fiscal year 2023, added to the following: for fiscal year 2019, $23 million and for each of fiscal years 2020 through 2023, $35 million. Funding for fiscal year 2024 and each subsequent fiscal year will be indexed from the fiscal year 2023 funding level.
Food Insecurity Nutrition Incentive Grant Program
The Food Insecurity Nutrition Incentive (FINI) Grant Program, which supports projects to increase purchase of fruits and vegetables among low income consumers using the SNAP through incentives at point of purchase, is provided with permanent funding and authority, while being renamed the Gus Schumacher Nutrition Incentive Program. Offers some modest program changes, including the establishment of Nutrition Incentive Program Training, Technical Assistance, Evaluation, and Information Centers and the establishment of a produce prescription program, and provides mandatory funding of $45 million for fiscal year 2019, $48 million for each of fiscal years 2020 and 2021, $53 million for fiscal year 2022 and $56 for fiscal year 2023 and each fiscal year thereafter.

Buy American Requirements

Requires the Secretary to enforce compliance of the Buy American provisions applicable to domestic food assistance programs administered by the Food and Nutrition Service (FNS), and specifies that USDA shall enforce full compliance with the requirements of the Richard B. Russell National School Lunch Act regarding Buy American Requirements for purchases of agricultural commodities including fish, meats, vegetables, and fruits.

3-Year Experience Requirement
Modifies the 3-year experience requirement for farm ownership loan eligibility. Allows the Secretary to reduce the experience requirement if the farmer or rancher has met specified education, business management, loan repayment or experience requirements. Allows the Secretary to waive the requirement altogether if the farmer or rancher has at least 1 year of experience as hired farm labor with substantial management responsibilities and a mentee relationship.
Loan Limits
Farm ownership direct loan limits are increased from $300,000 to $600,000. Farm ownership guaranteed loan limits are increased from $700,000 to $1.75 million. Direct operating loan limits are increased from $300,000 to $400,000. Guaranteed operating loan limits are increased from $700,000 to $1.75 million.

Loan Authorization Levels
All loan categories are reauthorized. Increases the overall loan authorization level from $4.226 billion to $10 billion for each fiscal year. The overall limit for direct ownership and operating loans is increased from $1.2 billion to $3 billion, and the overall limit for guaranteed loans is from $3.026 billion to $7 billion.
State Agricultural Mediation Programs
Reauthorizes the program with $7.5 million in discretionary funding. Eligible mediation practices are expanded to include lease issues, family farm transition, farmer-neighbor disputes, and organic disputes. Also allows mediation services to provide credit counseling. Also requires the Secretary to submit a report on the effectiveness of mediation programs and make recommendations to improve delivery of mediation services.

Combatting Substance Use Disorder in Rural America
Establishes a 20% set-aside for substance use disorder treatment services in the Distance Learning and Telemedicine program. Grants priority to facilities to provide prevention, treatment or recovery services in the Community Facilities Direct Loans and Grants program. Grants priority to grants to address substance use disorder education, treatment and prevention for the Rural Health and Safety Education program. Allows the Secretary to reprioritize rural development loan and grant applications to assist rural communities in responding to a significant public health disruption.
Rural Cooperative Development Grants
Reauthorizes Rural Cooperative Development Grants through 2023.
Provides priority for broadband applications that provide a minimum of 10 Mbps downstream and 1 Mbps upstream. Gives secondary priority to highly rural areas or areas experiencing outmigration. Increases the authorization for funding from $25 million to $350 million for each fiscal year. Creates a special fund for middle mile infrastructure. Codifies the existing Community Connect program.

Organic Research and Extension Initiative
Increases funding for the Organic Research and Extension Initiative (OREI) to support and advance research for the organic sector by providing mandatory funding of $20 million in each of fiscal years 2019 and 2020, $25 million for fiscal year 2021, $30 million for fiscal year 2022, and $50 million for fiscal year 2023 and each fiscal year thereafter.
Farm and Ranch Stress Assistance Network
Reauthorizes the program and authorizes $10 million in discretionary funding each fiscal year. Expands eligible entities to include Indian tribes, State departments of agriculture, qualified nonprofit organizations, other entities, as determined by the Secretary or a partnership of two or more. Also requires a report to Congress to provide an inventory and assessment of efforts to support behavioral and mental health among farmers, ranchers, and agriculture-related occupations.
National Food Safety Training, Education, Extension, Outreach, and Technical Assistance Program
Authorizes appropriations of $10 million for each of fiscal years 2019 through 2023. Eliminates the prohibition on funding that restricts USDA from providing additional grant funding once an entity has received three years of grant funding, though retains the length of each grant at no more than 3 years.

Biorefinery Assistance
Expands the program to include any facility that produces an advanced biofuel, a renewable chemical, a biobased product, or any combination of the three. Provides mandatory funding of $50 million in 2019 and $25 million in 2020.
Rural Energy for America Program
Reauthorizes the program and provides $50 million mandatory funding for each fiscal year through 2023.
Biomass Crop Assistance Program
Reauthorizes BCAP and authorizes $25 million discretionary funding for each fiscal year.
Carbon Utilization and Biogas Education Program
Creates a new program to provide education to the public about the benefits of carbon sequestration and to agricultural producers about opportunities for aggregation of organic waste from multiple sources into a single biogas system.

Local Agriculture Market Program
Creates the Local Agriculture Market Program (LAMP), which combines the Value Added Producer Grant program (VAPG) and the Farmers Market Promotion Program (FMPP) and the Local Food Promotion Program (LFPP), with mandatory funding of $50 million for each fiscal year. Each program (VAPG, FMPP, and LFPP) retains its original statutory authority, mission, grant priorities and activities, but includes a new focus on regional partnerships, as well as food safety assistance within the VAPG program. Mandatory funding levels include $17.5 million annually for VAPG (including up to $4.375 million for food safety assistance), $23.5 million for FMLFPP, and $5 million annually for regional partnerships.
Organic Certification
The bill adds additional resources and authorities for organic import enforcement intended to deter fraud in the organic sector by providing USDA with better data, information sharing and clarity of authority. New provisions include requiring an import certification for imports represented as organic in the U.S., modernization of trade tracking and data collection systems, and allowing USDA to oversee a certifying agent in a foreign country. $5 million will be provided for data collection purposes.
National Organic Standards Board
Adds a provision to require 2/3 of the votes cast at an NOSB meeting at which a quorum is present to be a decisive vote regarding changes made to the organic “National List.” Allows for an employee to represent the owner or operator on the NOSB. An employee may be of an organic farming operation, organic handling operation, or organic retail establishment, as designated by the owner or company. Employees of an owner or operator of an organic farming operation may represent the owner or operator on the National Organic Standards Board (NOSB).
National Organic Certification Cost-Share Program (NOCCSP)
The bill provides mandatory funding of $2 million for each of fiscal years 2019 and 2020; $4 million for fiscal year 2021; and $8 million for each of fiscal years 2022 and 2023 ($24 million total). Report language directs USDA to expend all carryover funding made available from fiscal years 2014-18 during fiscal years 2019-23. It is estimated by USDA that this carryover funding level is approximately $16.5 million, resulting in about $40.5 million for NOCCSP for FY2019-23.
Specialty Crop Block Grants
Amends the administrative requirements of the program to include and develop (in consultation with the Secretary) an evaluation of performance through cooperative agreements with State Departments of Agriculture and stakeholders to periodically evaluate the program. It authorizes the Secretary to use $5 million each fiscal year 2018-23 towards multi-state projects, including allowing the Secretary to directly administer all aspects of multi-state projects for applicants in a nonparticipating-State. Also adds new grant purposes.
Hemp Production
The bill amends the Agricultural Marketing Act of 1946 to allow States to regulate hemp production based on a state or tribal plan. The plan has multiple requirements, including requiring procedures for tracking where hemp is grown, an approach for testing THC concentration, a plan for disposal of plants that are out of compliance, among others things. For states and tribes without an approved plan, the Secretary is directed to establish a plan, in consultation with the U.S. Attorney General, to monitor and regulate hemp production. Does not affect or modify the Federal Food, Drug, and Cosmetic Act or the authorities of the Health and Human Services Secretary and Food and Drug Administration Commissioner. Nothing in the section authorizes interference with the interstate commerce of hemp.

Defines both “hemp” and “cover crop termination.”
Specialty Crops
Requires the Specialty Crops Coordinator to designate Specialty Crops Liaisons in each regional field office and to establish a website focused on efforts to provide and expand crop insurance for specialty crop producers.
Insurance Period
Allows hemp policies to extend beyond the period when the crop is in the field (similar to tobacco, potato and sweet potato policies).
Cover Crops
Defines cover crops as a good farming practice. Clarifies that cover crop termination should not affect the insurability of a subsequently planted insurable crop if the cover crop is terminated according to appropriate to guidelines.
Underserved Producers
Clarifies that Indian Tribes and beginning, veteran, and socially disadvantaged farmers and ranchers are underserved. Requires a report to the Committees every 3 years on availability of policies to underserved producers and recommendations to increase participation.
Treatment of Forage and Grazing
Allows for land that can be both grazed and mechanically harvested in the same season to be allowed to purchase policies for both intended uses in the same season.
Enterprise Units
Allows producers to establish a single enterprise unit across county lines, including the combination of multiple enterprise units or an enterprise unit with basic or optional unites.
Crop Production on Native Sod
Allows the governor of a State to opt into sodsaver if they are not currently covered by the provision. Clarifies that native sod acreage that is tilled would be subject to a reduction in benefits for not more than four cumulative years during the first ten years after initial tillage and during which the acreage is insured.
Agricultural Commodity
Includes hemp in the definition of an agricultural commodity for purposes of crop insurance.
Research and Development Authority
Provides $8 million for research and development. Requires the FCIC board to enter into contracts to carry out research and development to maintain or improve existing policies or develop new policies. Designates the following priorities: a review of Whole Farm Revenue policies, tropical storm and hurricane insurance, quality losses, citrus, hops, subsurface irrigation ditches, grain sorghum, limited irrigation practices, insurable irrigation practices for rice, greenhouse policies, local foods, high-risk, highly productive batture land policies.
Education and Risk Management Assistance
Consolidates crop insurance education grants for underserved producers with the Partnership for Risk Management Education and provides $10 million in funding for FY2019. Maintains authority and funding for the Agricultural Management Assistance program.

National Animal Disease Preparedness, Response, and Recovery Program
Establishes a National Animal Disease Preparedness, Response, and Recovery Program to be carried out through cooperative agreements with partners from states, universities, industries and other entities to address animal disease outbreaks. Includes a National Animal Vaccine Bank for acquiring vaccine and veterinary countermeasures needed to respond to animal disease outbreaks.
Feasibility Study on Livestock Dealer Statutory Trust
Requires a study on the feasibility of creating a Livestock Dealer Trust. The study will analyze the potential impacts such a trust would have on livestock producers, dealers, markets, financiers, and others in the livestock sector, specifically with regard to credit availability.
Farming Opportunities Training and Development
Combines the Beginning Farmer and Rancher Development Grant Program and the Outreach and Assistance for Socially Disadvantaged Farmers and Ranchers, Veteran Farmer and Rancher, and Beginning Farmers and Ranchers Program (“2501”) into a new section titled the Farming Opportunities Training and Outreach Program. Provides mandatory funding of $30 million in FY2019 and steps up funding to provide permanent baseline of $50 million in FY2023 and thereafter. 50 percent of funds is used for BFRDP and 50% for “2501.”
Beginning Farmer and Rancher Coordination
Requires the Secretary to establish a National Beginning Farmer and Rancher Coordinator to advise the Secretary and coordinate activities on programs, policies, and issues relating to beginning farmers and ranchers. The National BFR Coordinator will designate a state beginning farmer and rancher coordinator in each state.
Under Secretary of Agriculture for Rural Development
Requires the appointment of an Under Secretary for Rural Development.
Precision Agriculture Connectivity
Establishes a task force to review the connectivity and technology needs of precision agriculture in the United States. The task force will identify gaps in availability of broadband access on agricultural land and develop policy and recommendations to improve access.