First draft Farm Bill: Senate proposal closes SNAP loophole, boosts margin coverage for dairy farmers

May 8—Congress is putting together a new version of the Farm Bill, a wide-ranging package of legislation that sets agricultural and food policy for the U.S, typically in 5-year increments.

The last Farm Bill passed in 2018, and was temporarily extended under those 2018 terms last year, but lawmakers in the House and Senate agriculture committees have been working on new terms, aimed at updating policy for current conditions, for the last few months.

While the House Agriculture Committee, run by Republicans, plans to release the text of its version of the bill by May 23, the Senate Agriculture Committee, run by Democrats, released its version on May 1.

Called the "Rural Prosperity and Food Security Act," the Senate version combines more than 100 bills from both parties in Congress. The legislation includes a plan that would strengthen government assistance programs for failing or under performing farms, closes loopholes in the Supplemental Nutrition Assistance Program that kept people from benefiting from its work training programs, funds a health food initiative aimed at making healthy foods more accessible to those receiving food benefits, and special programs aimed at boosting the American dairy industry.

For dairy farmers, the bill adds funding to the Dairy Margin Coverage Program, a risk management program that provides cash to enrolled farmers when the difference between the federally-set price of milk and the average cost of feed falls below a certain point.

Preliminary numbers provided by the U.S. Department of Agriculture indicate the program paid out over $1.23 billion to the 17,096 enrolled dairy farms in 2023.

Of that, New York received $119.3 million for 1,820 enrolled farms, about 73% of the total number of dairy farms in the state. New York has the second-highest number of DMC enrolled farms, with Wisconsin leading by far with over 4,200 dairy farms and over $277 million in payouts last year.

Last year, in June and July, the margins calculated by the DMC dropped to their lowest levels on record in June and July, when the margin between feed and the all-milk price passed the $4 mark. Every single farm enrolled in the program received payments in those months.

The Senate's proposed Farm Bill will ask all participating dairy farmers to update their production history with the DMC to better account for the economics of their farms, and provides a 25% discount on the program's premium costs when a farmer enrolls for 5 years.

The bill would also require the USDA to conduct a mandatory plant cost study every two years to keep milk prices up to date, and requires the agency to collect more and better data on the organic dairy market specifically.

Other crop insurance programs are also getting more attention in the Senate bill, including expanding insurance programs at discounted rates for first-time farmers and ranchers just starting their businesses, and a Specialty Crop Insurance Advisory Committee, to be made up of farmers with experience in specialty crop farming, to create and adapt insurance programs for that sector of the industry.

The bill also creates an Office of Small Farms in the USDA, which will craft federal policy and assist specifically small, family-owned farms.

Sen. Kirsten E. Gillibrand, D-N.Y., a member of the Senate Agriculture Committee, said during a press conference Tuesday morning that she is happy to see the provisions for farmers in this year's Farm Bill.

"New York is home to more than 30,000 farms, our state is the largest producer of yogurt and cottage cheese in the nation," she said. "We are also among the top producers of milk, apples and grapes. Dairy and specialty farming is enormously important to our state's economy."

She said she was glad to see the Senate bill includes additional funding for the Specialty Crop Block Program and more funding for the Dairy Margin Coverage program.

The bill also includes a number of social safety net adjustments, including adding an exemption for SNAP work training program participants to make sure the payment they're getting from that work training program is not counted against their eligibility for SNAP itself.

Gillibrand has advocated for years to close this loophole, and on Tuesday she said she was happy to see the Farm Bill as proposed by the Senate will close it.

"Right now, wages earned through these training programs are counted as income, which counts against SNAP eligibility," she said. "That means a SNAP beneficiary could get kicked off SNAP benefits just from participating in these programs. That's unacceptable."

The details of the House bill are more vague, but an outline provided by House Agriculture Committee Chair Glenn Thompson, R-Pa., indicates the House bill, led primarily by Republicans, includes some of the same provisions included in the Senate version, including reauthorizing the DMC program. It also lays out a number of protectionist measures, some also included in the Senate version, like a block on the use of federal aid to support foreign-owned farms.

Rep. Marcus J. Molinaro, R-Tivoli, is one of two House Agriculture Committee members from New York. In a statement, he said he's held listening sessions and 11 town halls across his district, covering the upper Hudson Valley and Southern Tier, to hear what his constituents want included in the bill.

"I've taken that feedback and have been working hard to craft a Farm Bill that delivers increased benefits for farmers and working families," he said in a statement. "Our committee is excited to unveil this bill very soon."

Molinaro has carried a number of bills related to agriculture policy in this session of Congress, including the Dairy Farm Resiliency Act which make the changes to the Dairy Margin Coverage program called for in this year's Farm Bill — allowing participants to update their production numbers so their participation in the program better reflects their actual production if it has grown or shrunk since 2014, when the current program's data is based on.