WASHINGTON ― Every five years, Congress passes a farm bill that pairs farm subsidies and food stamps, relying for passage on a coalition of rural and urban lawmakers.
But this year, that coalition is threatened by the bill’s uneven treatment of farmers and poor people. While it would limit food stamp eligibility with expanded work requirements and a lower income ceiling, it would make receiving subsidies easier for some farmers.
Rep. Michael Conaway, R-Texas, the chairman of the House Agriculture Committee and the bill’s lead author, pointed out that farm incomes have been sharply down since reaching record highs in 2013.
“We’ve always had a safety net for farmers, and we’re trying to maintain it,” he said. “We don’t put any new money in the program.”
The federal government spends roughly $17 billion annually on farm subsidies, including crop insurance and programs that protect against drops in farm revenue and commodity prices. Currently, high-earning farmers are ineligible for the commodity programs. Conaway’s bill would adjust the way commodity subsidies are calculated and exempt some types of businesses from an income limit.
At the same time, some food stamp recipients would be subject to a stricter income limit, with the maximum household income for eligibility reduced from the current 200 percent of the poverty line to 130 percent for certain applicants. The measure would cut off 400,000 households.
The lower income threshold for some Supplemental Nutrition Assistance Program recipients, plus new work requirements and other provisions, would shave the number of beneficiaries by 1.2 million over 10 years, according to the Congressional Budget Office. Under current law, the office projects that enrollment will fall from about 40 million to 32 million a decade from now.
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Since Democrats are unanimously opposed, Conaway has been trying to woo conservative Republicans in order to pass the bill on a party line vote, with the food stamp reductions as his main selling point.
Conservative groups outside Congress have been mildly supportive of the SNAP changes but strongly against the overall bill because of its farm subsidy provisions.
“There are some changes to the nutrition programs, and there are no positive changes to the [agricultural] welfare programs,” said Joshua Sewell, a policy analyst with the conservative organization Taxpayers for Common Sense.
Currently, farmers with incomes above $900,000 are ineligible for commodity subsidies, which are capped at $125,000 annually per farm household member. The bill would remove the income limit for certain businesses classified as pass-through entities ― so called because their profits pass through to their owners’ individual tax returns instead of being taxed at the corporate level.
“All we did is try to level the playing field between entities,” Conaway said, arguing that federal regulations make arbitrary distinctions between different type of firms. “Individuals still have the same exact qualifying standards.”
In other words, each owner of a high-earning farm could receive a full subsidy individually as long as his or her annual income is less than $900,000, or $1.8 million for a married couple. The bill would allow farmers’ cousins, nieces and nephews to receive subsidy payments, rather than just immediate family members, as under current law.
“They’ve put Ancestry.com in charge of our farm subsidy system in a way that’s going to expose the taxpayer to untold new costs,” said Scott Faber of the Environmental Working Group, a liberal nonprofit.
Farm partnerships in which partners are individually eligible for subsidies make up about 6 percent of farms and receive 17 percent of farm payments, according to an EWG analysis. Under the proposed legislation, partners in some pass-through entities currently treated as a single unit — additional 5 percent of farms — would be eligible for subsidies individually.
Both liberal and conservative farm welfare critics say U.S. agricultural subsidies unnecessarily benefit the biggest farms and create an unhealthy incentive for consolidation. Farm households with annual incomes above $250,000 accounted for 12 percent of farms but 60 percent of subsidies in 2012, according to the most recent data. Farms with more than $1 million in sales were responsible for 51 percent of production in 2015, up from 31 percent in 1991.
Rep. Jim Jordan, R-Ohio, is a founding member of the House Freedom Caucus, a bloc of die-hard conservatives from whom Conaway needs support to get his bill through the House. Jordan said that he has been focused on the food stamp provisions and that he figured there would be amendments addressing the farm subsidies.
Conaway is hoping to bring the farm bill to the House floor for a vote as soon as next week. He has been pushing party leaders to disallow amendments from anyone who doesn’t plan to vote for the final version of the bill — a highly unusual stipulation.
“That type of loyalty pledge would make even President Trump blush,” said Rep. Jim McGovern, D-Mass. “This is deeply undemocratic and suggests Democrats shouldn’t even bother to participate in the amendment process.”
Whatever passes the House would ultimately have to be merged with a Senate bill that will likely have far more modest provisions, since Democrats hold enough Senate seats to block the legislation.
Matt Fuller contributed reporting.