US House votes to override Bush veto of Farm Bill, 318-108; Senate override vote today

May 22, 2008

In Washington, the US House of Representatives voted to override President Bush’s veto of the Farm Bill. The vote was 316-108, with half of House Republicans voting to override. The $289 billion bill includes more than $200 billion for food stamps and nutrition programs over the next five years, an increase of $10 billion to recognize the higher cost of food. The Senate is expected to vote today, and is also expected to override. If the Senate votes to override the veto, the bill will become law on Senate passage.

The bill contains a historic two-tiered ethanol incentive, with corn ethanol subsidies dropping to $0.45 per gallon and a new $1.01 subsidy introduced for cellulosic fuels. A last minute amendment had changed the language of the higher subsidy from “cellulosic ethanol” to “cellulosic fuels”, which otherwise would have exempted companies such as LS9 and Gevo.

The Farm Bill had not been vetoed since 1956, and originally
observers did not think that an election-year veto was possible, since
the top ten states in farm subsidies control half the electoral votes
for the presidential campaign. The White House
budget director said that the bill â€œdoesnâ€™t have hardly enough reform.â€

A controversial feature has been the cap on farmer income in order
to receive subsidy payments. The new bill forbids subsidies to farmers
with more than $750,000 in income, or $1.5 million for a married couple.

EWG has published a list of the leading subsidy recipients, who received as much as $900,000 in subsidy payments in 2006.

In Iowa, Senator John McCain said that, as drafted. he would veto the Farm Bill because of excessive subsidies,
which he called unnecessary. McCain added, â€œI do not believe we should
have tariffs against imported products, but I want to promise you as
president of the United States of America I will recognize one
fundamental fact, and that is the farmer in the state of Iowa and the
United States of America is the most productive, the most efficient and
the best, and I will open every market in the world to your products
and I will sell them.â€

The Farm Bill bill contains a reduced 45 cents per gallon ethanol
subsidy and a $1.01 per gallon subsidy for cellulosic ethanol. Tax
credits for biodiesel were removed from the bill, and the tariff on
Brazilian ethanol is extended through 2010.

The bill contains $900 million for biofuels development, $900
million for nutrition programs aimed to offset higher food prices,
while land stewardship programs would received an additional $4
billion, and specialized crops $1.35 billion.

Negotiations over the stalled Farm Bill had put existing ethanol incentives in peril
last month, according to House Agriculture Committee chairman Collin
Peterson. The chairman said that, in order to offset $9.5 billion in
increased spending, Senate negotiators had proposed a $0.05 per gallon
cut in the ethanol blender tax credit and reductions in other
incentives for a total of $1.226 billion in ethanol support cuts.

Earlier this month, the US House of Representatives had voted to extend the existing Farm Bill until April 25
to give lawmakers more time to resolve differences between the House
and Senate versions of the new Farm Bill, which includes tax breaks and
incentives for biofuels. President Bush has stated that he will not
sign legislation extending the current Farm Bill for another year.

The Farm Bill
was passed by the Senate in the fall, while the House version passed in
July. Senate Agriculture Committee chairman Tom Harkin said the bill
would earmark $1.3 billion for biofuels over the next five years.

The Senate passed an overall funding measure on October 5, but the
Agriculture Committee under committee chairman Tom Harkin had been
working on specific program allocations until November, which include
ethanol tax credits and next-generation biofuel investments. The Senate
finance committee previously proposed cutting the ethanol tax credit to
46 cents per gallon.

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Written by Jim Lane · Filed Under Producer News