Successful Farming’s Chuck Abbott reported Wednesday that “Republicans on the Senate Agriculture Committee proposed a $4 billion injection into the crop insurance program so that the government would pay a larger share of the premiums on policies offering the highest levels of coverage.”
The plan, known as the FARMER Act, “was estimated at $4.2 billion over 10 years, said (act sponsor Sen. John) Hoeven. The most recent Congressional Budget Office projections say crop insurance would cost $124.7 billion over the same period” according to Abbott.
Under the FARMER Act, “premium support for revenue and yield protection at the 80% coverage level would increase from 68% to 77%,” Farm Progress’ Joshua Baethge reported. “At the 85% coverage level, protections would increase from 53% to 68%. The proposed increases would only be provided to enterprises and whole farm units.”
“Premium support for the Supplemental Coverage Option would increase from 65% to 80%, while SCO coverage levels would increase from 86% to 90%,” Baethge wrote. “The FARMER Act also includes a provision directing USDA’s Risk Management Agency to conduct a survey on how to improve SCO effective in counties larger than 1,400 square miles.”
Plan Counters Democrat Proposal The plan, known as the FARMER act, counters an earlier suggestion on crop insurance from Senate Ag Committee Chairwoman Debbie Stabenow, who said in January that “the way to provide higher levels of insurance coverage and streamline federal programs was to give farmers a choice: They could enroll in USDA crop subsidy programs or they could buy a highly subsidized revenue insurance policy,” Abbott reported.
“At present, upland cotton is the only commodity where that sort of policy, known as STAX, for Stacked Income Protection Plan, is offered and growers are barred from enrollment in crop subsidy programs,” Abbott reported. “The government pays 80 cents of every dollar in STAX premiums, while it pays 62 cents of each $1 in crop insurance premiums, on average. STAX provides coverage for up to 20 percent of expected crop revenue in a county or group of counties.
“Hoeven and his cosponsors proposed the opposite of Stabenow’s suggestion — farmers could purchase ‘enhanced crop insurance coverage’ if they wish, as well as signing up for the Price Loss Coverage or Agriculture Risk Coverage subsidies,” Abbott wrote.
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Categories: Illinois, Crops