On Sunday, the Senate-House conference committee finally reached an agreement to extend the Milk Income Loss Contract program as part of its budget-reconciliation bill that includes more than $40 billion in spending cuts over the next five years.

On Monday, the full House voted 212 to 206 to pass the budget reconciliation bill that includes the MILC extension.

Since the original Senate budget bill included a provision to extend the MILC program, many expect the Senate will pass the bill. However, in politics one must remember it’s never a done deal until all the votes have been counted.

According to Luke Punzenberger, with Rep. Mark Green’s (R-Wis.) office, the budget-reconciliation bill has met some resistance in the Senate. Sen. Harry Reid, D-Nev., is not happy with the budget bill. The Senate Minority Leader has threatened to remove MILC from the bill with the hope of killing the budget bill altogether, says Punzenberger.

If that happens House and Senate negotiators would have to go back to conference committee. If however, the Senate passes the budget-reconciliation bill it would proceed to President Bush for his signature.

As included in the budget-reconciliation bill right now, MILC receives a two-year extension, making it run concurrent with the lifespan of the 2002 Farm Bill. However, the payment rate was reduced. The program still has the same trigger point -- a Boston Class I price of $16.94 per hundredweight. But producers will now receive just 34 percent of the difference between the current Boston Class I price and the trigger price of $16.94. In the original MILC program that expired on Sept. 30, producers received 45 percent of the difference. Payments are still capped at 2.4 million pounds of milk. If approved by the Senate, and signed into law by President Bush the MILC program would be retroactive back to Oct. 1.

To read an article on this topic in the Appleton Post Crescent, go to: http://www.postcrescent.com/apps/pbcs.dll/article?AID=/20051220/APC0101/512200619/1004

Rep. Mark Green’s office, Appleton Post Crescent, NMPF