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Conservation programs, other farm subsidies targeted in federal budget battles

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Over the past five years, Nebraska farmer Kevin Raun has submitted numerous conservation plans to the USDA for funds to convert his family cattle and corn farm into an eco-friendly place.

Raun said the work seemed to finally pay off when the Agriculture Department pre-approved him for a Conservation Stewardship Program contract this year, but that was before conservation programs took unprecedented hits last month during the final days of the 2011 budget debates.

“I had to jump through a lot of hoops, so I hope the money is there,” Raun said. “My feeling with these budget cuts is that they need to preserve the conservation programs and limit how much they are giving in subsidies to large, wealthy farmers.”

This debate over conservation vs. subsidy cuts is at the heart of discussions on Capitol Hill as lawmakers begin to shape the 2012 budget and begin talks about the next Farm Bill — a critical document because it sets funding priorities for the next decade.

Conservation programs were cut by nearly $500 million last month for the 2011 budget, and the House budget for 2012 calls for another $18 million in conservation cuts. What’s unclear is how many of those cuts will come out of the USDA’s budget.

The Obama administration’s push to spread some of the pain to the wealthiest, most profitable farms, however, is also gaining momentum. The House budget calls for $30 billion in subsidy cuts over the next 10 years.

“There is a growing feeling that [Congress] must find a way to make sure that the cuts affect everyone,” said Ferd Hoefner, policy director for the National Sustainable Agriculture Coalition, “to make sure the mega-producers are not the ones let off the hook this time around. “

To get around cuts in the past, corporate farms would add a partner or two that could then apply for separate subsidies, thereby restoring the overall take to prior levels.

Members of Congress from both parties are looking for ways to close off that option so subsidies are used to help farmers get through lean times — not simply bump up already good profits. In turn, environmentalists hope these savings from subsidy cuts might help spare deeper cuts in conservation programs in the years to come.

A study by the USDA’s Economic Research Service shows that farms that make the highest profits receive the highest levels of subsidies. For example, farms with an annual income of $210,000 receive an average of $30,000 or more. Farming operations that earn $110,368 receive $10,000 to $29,999, and farm households that make $70,117 get between $1,000 and $9,999.

Though Raun fits into the upper tier on subsidy payments, he considers himself to have a medium-size operation. He hopes that as the Senate begins its work on the budget this summer, lawmakers will find ways to reduce funding for the wealthiest farmers while preserving programs that will help people such as him retool their operations to reduce pesticide use and prevent soil erosion.

“The farmers I know, they know they are going to be getting less,” Raun said. “I don’t think there is any doubt about that. Right now grain and livestock prices are really high, so we don’t need as much help right now, but it’s good for everyone if we have conservation programs.”

In a statement, the USDA said it is working to find ways to minimize the impact of the most recent cuts to conservation programs.

“USDA isn’t immune to the fiscal challenges facing America, and our current FY 2011 budget includes some difficult sacrifices in order to maintain our country’s fiscal health,” the statement said. “While our conservation programs took a reduction in the final budget for FY11, USDA will continue to lead on priority areas such as watershed restoration, using an all-lands approach to restoring and maintaining our precious natural resources, and help ensure clean drinking water for millions of Americans.”

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