This summary highlights and compares major provisions in the U.S. House of Representatives (House) and Senate versions of the Farm Bill that may be of particular interest to food companies and retailers. As they left town for the President’s Day recess, the Senate offered the House an outline of spending that is reportedly $12.3 billion over the current baseline. In a meeting today, February 19, 2008, with agricultural groups, House Agriculture Committee Chairman Collin Peterson said he believes a compromise will be reached with the Senate during the current recess so that House and Senate conferees can carve up the pie when they return to Washington, D.C. early next week. Currently, House and Senate staff are conducting meetings to iron out the differences between the two versions in advance of the return of the conferees. Hanging over the conference committee is a sustained veto threat by the White House, based on unhappiness with funding increases, how those increases will be paid for, and Congress’s refusal to adopt reforms supported by the White House. Time is running out for a compromise, with the current Farm Bill extended only until March 15, 2008. If a new bill has not been passed or the current bill not extended, farm programs would revert to permanent law under the Agricultural Adjustment Act of 1949 (’49 Act). Operating under the ’49 Act would increase payments for some commodities while excluding payments for many other commodities that have farm program benefits granted subsequent to the passage of the ’49 Act.
The major Farm Bill provisions outlined in this alert are:
- Country of origin labeling (COOL)
- Commodity programs
- Trade
- Nutrition
- Horticulture, specialty crops, and organic agriculture
- Miscellaneous provisions
Country of Origin Labeling (COOL)
Before House passage of its version of the Farm Bill, stakeholders reached a compromise on COOL. The compromise held during consideration of the Senate version of the bill, with only one modification: the Senate added chicken and macadamia nuts to the list of covered commodities. Implementation of the original COOL provision for meat, which was contained in the 2002 Farm Bill, has been delayed by a provision in an appropriations bill, but it is now due to go into effect by September 30, 2008.
Under the compromise that would replace the original COOL, a retailer of beef, lamb, pork, and goat may designate the product as having a United States (U.S.) country of origin if the commodity is derived from an animal that was exclusively born, raised, and slaughtered in the United States, or was born and raised in Alaska or Hawaii and transported for a period of not more than 60 days through Canada to the United States and then slaughtered in the United States. For multiple countries of origin, a retailer may designate the country of origin of the commodity as all of the countries in which the animal may have been born, raised, or slaughtered. If the commodity is from a foreign country, a retailer would be required to designate a country other than the United States as the country of origin.
No changes were made to the labeling requirements for fish, which went into effect in 2005 and remain in effect today. In the case of farm-raised fish, it must be hatched, raised, harvested, and processed in the United States to be labeled as U.S. product. For wild fish, it must be harvested in the United States, a territory of the United States, in a state, or by a vessel that is registered in the United States or is documented under chapter 121 of title 46 of the U.S. Code, and must be processed in the United States, a territory, or a state, including the waters of a state.
The penalty and audit provisions were modified in both the House and Senate versions in a manner that would shift some of the burdens of recordkeeping and potential liability from retailers to suppliers. Also, the maximum penalty for violations would be reduced from $10,000 to $1,000 per violation.
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