The Agriculture Department would be barred, under language in a House appropriations bill, from proceeding with proposed marketing regulations opposed by major meatpackers and livestock trade groups.
The House Agriculture Appropriations Subcommittee approved the draft fiscal 2012 spending bill, including the provision, by voice vote on Tuesday. The bill would provide $17.3 billion in discretionary funds to the Agriculture Department, Food and Drug Administration and related agencies, a $2.6 billion cut from fiscal 2011. The measure also includes $108 billion in mandatory funding, almost 3 percent more than in fiscal 2011.
The policy rider would bar the Agriculture Department’s Grain Inspection Stockyard and Packers Administration (GIPSA) from producing a regulation requiring meatpackers to report and justify pricing agreements with livestock producers. The proposed rule, unveiled last year, was written in response to a 2008 farm law (PL 110-246) directive to review marketing and competition issues in the livestock industry.
Supporters say the regulation is needed because competitive pricing no longer exists in an industry where four major meatpackers control 85 percent of the market.
But meatpacking companies say the agency went beyond the mandate of the farm law and produced a regulation that could make them targets of unjustified lawsuits. Major livestock groups warn that their members could receive less for their cattle, hogs and poultry if slaughter operations abandon premiums to avoid charges of discriminatory pricing.
Lawmakers from both parties have lined up against the new pricing rules. In a May 18 letter, 147 House members urged Agriculture Secretary Tom Vilsack to withdraw the preliminary rule, analyze the impact of proposed changes on the industry, then propose a revised rule. Agriculture Appropriations Subcommittee Chairman Jack Kingston, R-Ga., was among those signing the letter.
At the subcommittee markup on Tuesday, Ohio Democrat Marcy Kaptur said the policy rider would prevent the department from getting tough on “monopolistic companies.” She accuses meatpackers of using private agreements with cattle, pork and poultry producers to control prices.
“Smaller farmers and slaughterhouses are being squeezed out of the market,” said Kaptur, the only subcommittee member to speak on the issue at the markup.
Bill Bullard, chief executive officer of R-Calf USA, a group that represents live cattle producers and supports the Agriculture Department rule, said opponents “literally have a stranglehold on the House.”
Bullard has said he is counting on a handful of Democrats and Republicans in the Senate to keep the policy rider out of fiscal 2012 spending legislation. Herb Kohl, D-Wis., chairman of the Senate Agriculture Appropriations Subcommittee, has expressed concern about the concentration of power among the meatpackers, Bullard said.
Democrats focused their criticism at the markup on proposed cuts in nutrition programs. Norm Dicks of Washington, the full Appropriations Committee’s top Democrat, said the proposal to cut discretionary spending on the Women, Infants and children program by $832 million, to $5.9 billion, could shut out as many as 475,000 eligible participants.
“This breaks a 15-year bipartisan commitment to what we do about women, infants and children,” added Rosa DeLauro, D-Conn., the subcommittee’s former chairwoman. “It is just unconscionable and morally wrong that we are going to watch women and children go hungry.”
Kingston responded that the draft bill would provide $125 million in contingency funds to prevent large numbers of qualified recipients from being driven out of the programs. He also said the measure would allow the Agriculture secretary to roll over unspent funds in the account from fiscal 2011. “We’re going to watch these numbers closely,” Kingston promised.
The bill includes $71.2 billion in mandatory spending for the Supplemental Nutrition Assistance Program, formerly known as food stamps. That represents a 9.2 percent increase from fiscal 2011, though it is $2 billion less than President Obama requested. An additional $18.8 billion in mandatory spending would go to child nutrition programs, 8.4 percent more than in fiscal 2011.
The only amendment offered at the markup, by Cynthia M. Lummis, R-Wyo., was rejected by voice vote. Her proposal would have eliminated the Self-Help Housing program, which helps individuals build their own homes in rural areas, and directed the $22 million in savings to fund rural broadband loans. But some of her Republican colleagues argued that there are already programs to streamline broadband access in rural communities, and they said many operate with questionable effectiveness.
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