10/22/2012

S P E C I A L

R E P O R T

‘Capital Gains & Estate Taxes’ Farmers urge lame-duck action | 4

October 22, 2012 Vol. 91

‘Farm vehicles’ Rules put the brakes on troublesome regs | 3

‘Farmer lawsuit’

Court allows AFBF to join suit against EPA | 6

AFBF presents case on Chesapeake Bay regulations Attorneys for the American Farm Bureau Federation earlier this month delivered legal arguments explaining why the Environmental Protection Agency violated the Clean Water Act when it issued its “Total Maximum Daily Load” regulation for the entire Chesapeake Bay watershed.

No. 19

Farmers, ranchers rally around labor proposal A new proposal for a flexible, market-based agricultural worker program has united Farm Bureau’s diverse membership and will allow growers in all sectors and regions of the country to call for labor reform with one voice.

The proposal was developed by a working group of state Farm Bureau staff from Arizona, California, Florida, Louisiana, Michigan, New Jersey, New York, North Carolina, Pennsylvania and Washington. The group was tasked by the American Farm Bureau Federation board of directors with developing a legislative proposal

that will unify Farm Bureau and agriculture employers as Congress moves forward on any immigration debate.

The group envisions a new program under which agricultural employers—including packers, processors and others related to agriculture—would register with USDA. Employers would be allowed, but not required, to offer employees a contract, which the employees would be free to accept or decline.

A worker who declines a contract would be an “at-will” employee with a visa that is fully por-

table among employers registered with USDA. This at-will employee visa would provide work authorization for up to 11 months, while a contracted worker’s visa could go up to 12 months, dependent on the employer’s need.

“This two-pronged approach duplicates how the domestic market currently operates, giving both employers and employees more options and flexibility. It accounts for the needs of all sectors of agriculture—from a small strawberry grower in California who needs Labor Continued on Page 6

West Nile outbreak highlights need for regulatory overhaul

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©istockphoto.com/sweetcrisis

n e w s p a p e r

MOSQUITOES AND THE DISEASES THEY CARRY were more prevalent this summer as new federal regulations led to reduced mosquito control programs. As of mid-September, nearly every state had reported West Nile infections in people, birds or mosquitoes.

New Clean Water Act requirements–and the administrative costs and threats of lawsuits that come with them—are a threat to public health as they force municipalities and states to curtail their programs to control viruscarrying mosquitoes, according to Rep. Bob Gibbs (R-Ohio).

Reduced mosquito control operations have resulted in increased risk of diseases like West Nile Virus, cases of which have tripled since 2011. As of Sept. 18, 48 states have reported West Nile infections in people, birds or mosquitoes.

Of the more than 3,000 people who have come down with West Nile, 134 have died, according to the Centers for Disease Control.

Gibbs said he has received multiple reports of delayed preventative spraying because of what he calls “redundant permitting regulations.”

“The fact that bureaucratic regulations are standing in the way of vital mosquito control programs in this country is truly absurd,” said Gibbs. “When the impact of these repetitive regulations is an increase in the presence of mosquitoes carrying West Nile Virus, it is clear that these pesticide permit regulations are extremely ineffective and detrimental.”

Dorothy Meaker’s family agrees.

Meaker, of Colorado, died from West Nile this summer and her son and daughter-in-law want to

make sure laws and regulations don’t put other people at risk.

“There are remedies for this, we just need to let the people who can do something about it, do it,” said Meaker’s daughter-in-law.

The pesticide permit regulations at issue were put in place in November 2011 after EPA refused a request from USDA Secretary Tom Vilsack to appeal a ruling in the National Cotton Council v. EPA case. In that case, the 6th U.S. Circuit Court of Appeals overturned nearly 40 years of law, saying that pesticide applicators need to obtain Clean Water Act permits for pesticides applied on, West Nile Continued on Page 3

Viewpoint

October 22, 2012

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Rural votes could make difference in election

By Linda (L.J.) Johnson The red and blue highlighted U.S. map we see so frequently as election time nears can be disheartening for rural voters. They may rightly begin to wonder if rural votes make a difference in any race where metropolitan areas exist. The answer is “yes.”

For example, President George W. Bush won the rural vote in 2004 by 19 points. In 2008, President Barack Obama performed unusually well in rural areas, losing there to Sen. John McCain by just eight points. That means 9 million rural voters cast their ballots for our current president.

During this election cycle both presidential candidates have frequently been seen in states that have large rural regions. Both are well aware that rural country roads are an important part of the road map that leads to the White House.

A recent poll for the Center for Rural Strategies showed 54 percent of rural voters favored candidate Mitt Romney. President Obama knows he needs to win as many votes as he can in rural areas in 2012 to keep the margins tight again. Swing states that were polled are Colorado, Florida, Iowa, Nevada, New Hampshire, North Carolina, Ohio, Virginia and Wisconsin.

The Senate is another battleground where

rural votes matter. Control of the Senate may well be determined by rural voters in Indiana, Maine, Montana, Nevada, Ohio, North Dakota, Virginia and Wisconsin. All of these states are in the toss-up column, according to most political pundits.

In 2010, two-thirds of the nation’s most competitive House races were in rural America.

Current polling shows that between 24 and 26 House seats are in the toss-up category and about 30 races are leaning to one party or the other. Do you live in one of the states that will determine control of the House? They are Arizona, California (three seats), Colorado, Connecticut, Florida (two seats), Illinois (two seats), Massachusetts, Maine, Michigan, Minnesota, Nevada, North Carolina, New Hampshire, New York (four seats), Ohio, Pennsylvania, Rhode Island, Texas and Utah.

Eleven states have gubernatorial races this year. The rural vote is expected to make a big difference in three that are in the toss-up column: Montana, New Hampshire and Washington.

Do rural votes really make a difference? Just ask Wisconsin Gov. Scott Walker, who faced a tough recall election earlier this year. While he lost the city vote, he won his recall election because of rural and other non-urban voters. Just ask former Reps. Betsy Markey of Colorado, Debbie Halvorson of Illinois, Frank Kratovil of Maryland, John Boccierri of Ohio and Steve

Kagen of Wisconsin if rural votes matter.

They all lost their House seats in 2010.

Is the red and blue map disheartening?

Maybe. It is a fact that Democrats normally pick up a big vote in the cities. And Republicans usually pick up a big vote in the suburbs. But the rest of story is that the rural vote provides candidates from both parties the winning edge when the polls close.

So remember, every vote from rural America is important. Cast your vote for the candidates you want to represent you. It is your patriotic duty and in the end, you just might be the deciding vote.

Linda (L.J.) Johnson is director of policy implementation programs at the American Farm Bureau Federation.

Shoppers find higher prices for breakfast items Shoppers paid slightly more for food at the grocery store during the third quarter of the year, with many popular breakfast staples showing an increase in retail price. Higher retail prices for eggs, bacon, orange juice, milk and toasted oat cereal, among other foods, resulted in a slight increase in the latest American Farm Bureau Federation Quarterly Marketbasket Survey.

The informal survey shows the total cost of 16 food items that can be used to prepare one or more meals was $51.90, up $1 or about 2 percent

FBNews

Mace Thornton, Acting Director, Public Relations Erin Anthony, Editor Phyllis Brown, Assistant Editor Tracy Grondine, Contributing Writer Sarah Bittner, Contributing Writer

compared to the second quarter of 2012. Of the 16 items surveyed, 9 increased and 7 decreased in average price compared to the prior quarter.

The cost for the overall basket of foods decreased about 2 percent compared to one year ago.

Most of the slight quarter-to-quarter increase in the marketbasket of foods can be attributed to higher retail prices for breakfast staples, apples and bagged salad.

“While prices were up from the second quarter, compared to a year ago, the marketbasket price was actually lower, by about 2 percent,” said John Anderson, AFBF’s deputy chief economist. “For most of this year, food prices have been relatively stable. This is consistent with the very slow but steady growth in the general economy that has been seen throughout the year, along with fairly stable energy prices.”

Items showing retail price increases for the third quarter included apples, up 36 cents to $1.86 per pound; large eggs, up 33 cents to $1.94 per dozen; bagged salad, up 20 cents to $2.94 per pound; bacon, up 19 cents to $4.23 per pound; whole milk, up 19 cents to $3.55 for one gallon; orange juice up 13 cents to $3.30 for a half-gallon; boneless chicken breasts, up 8 cents to $3.17 per pound; sirloin tip roast, up 5 cents to $4.74 per pound; and toasted oat cereal, up 1 cent to $3 for a 9-ounce box.

These items showed modest retail price declines: ground chuck decreased 19 cents to $3.47 per pound; white bread decreased 13 cents to $1.75 for a 20-ounce loaf; vegetable oil, down 7 cents to $2.91 for a 32-ounce bottle; flour decreased 5 cents to $2.57 for a 5-pound bag; Russet potatoes decreased 5 cents to $3.01 for a 5-pound bag; sliced deli ham decreased 4

October 22, 2012 Vol. 91

No. 19

Published semimonthly, except monthly in August and December, by the American Farm B ­ ureau Federation, 600 Maryland Ave., SW, Suite 1000W, Washington, DC 20024.

Phone: 202-406-3600. E-mail: fbnews@fb.org. Web site: http://www.fb.org.

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cents to $5.20 per pound; and shredded cheddar decreased 3 cents to $4.26 per pound.

Several items showing an increase in retail price from quarter-to-quarter also showed year-to-year increases: sirloin tip roast, up 11 percent; eggs, up 9 percent; bagged salad, up 8 percent; and apples, up 2 percent.

The year-to-year direction of the Marketbasket Survey tracks with the federal government’s Consumer Price Index (http://www.bls.gov/ cpi/) report for food at home. As retail grocery prices have increased gradually over time, the share of the average food dollar that America’s farm and ranch families receive has dropped.

“Through the mid-1970s, farmers received about one-third of consumer retail food expenditures for food eaten at home and away from home, on average. Since then, that figure has decreased steadily and is now about 16 percent, according to the Agriculture Department’s revised Food Dollar Series,” Anderson said. Details about USDA’s new Food Dollar Series may be found online at http://www.ers.usda.gov/publications/ err-economic-research-report/err114.aspx.

Using the “food at home and away from home” percentage across-the-board, the farmer’s share of this quarter’s $51.90 marketbasket would be $8.30.

AFBF has been conducting the informal quarterly Marketbasket Survey of retail food price trends since 1989. The mix of foods in the marketbasket was updated in 2008.

According to USDA, Americans spend just under 10 percent of their disposable annual income on food, the lowest average of any country in the world. A total of 79 shoppers in 26 states participated in the latest survey, conducted in August.

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October 22, 2012

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Capitol View

Farm vehicle rules put the brakes on troublesome regs New farm-vehicle rules help protect farmers from burdensome regulations meant for commercial truck drivers and clarify certain driving restrictions during growers’ busiest times of the year. The rules, put into law as part of the Moving Ahead for Progress for the 21st Century Act (MAP-21, H.R. 4348), went into effect Oct. 1.

One of MAP-21’s two statutory exemptions for agriculture releases farmers and ranchers from most of the Federal Motor Carrier Safety Regulations, which are intended for commercial drivers like long-haul truckers. The new regulations give growers, their employees and select others a break on FMCSRs related to commercial driver’s licenses and medical requirements, among others.

Another part of this exemption will make it easier for farmers and ranchers to transport their products to market, especially if that requires them to cross a state border.

“Previously, just crossing a state line—even if was only mere miles from the farm—triggered conflicting requirements for farmers who were simply transporting their own crops,” explained Andrew

Walmsley, American Farm Bureau Federation transportation specialist. “This was especially tough on producers who had to bring their goods to markets in another state.”

Now, covered farm vehicles with a gross vehicle rating less than 26,001 pounds are exempt from many of the FMCSRs and can operate anywhere in the U.S. Farm vehicles that are more than 26,001 pounds can operate in the state where they are registered or within 150 air-miles from their farm or ranch without being subject to the rigorous requirements of many of the FMCSRs. Both parts of the rule apply to “covered farm vehicles,” which are those driven by a farmer or rancher, a member of the family or an employee. Vehicles being used to transport farm commodities, livestock, machinery or supplies also fall into the covered category, as do those with a special agriculture license plate or other designation granted by the state.

The second exemption provides relief from federal hours-of-service rules during the planting and harvesting seasons.

The exemption applies to drivers

transporting farm or ranch goods from the operation the products came from to a location within a 150 air-mile radius; drivers transporting farm supplies from a wholesale or retail outlet to the location where they will be used within a 150 air-mile radius; and drivers transporting farm supplies from a wholesale distribution point to a retail distribution point within a 150 air-mile radius.

Each state determines its own

harvesting and planting periods.

“This change is particularly crucial during the two busiest times of a farmer’s year,” Walmsley noted.

The new rules do not exempt farmers and ranchers from state requirements and states are given up to three years to incorporate the appropriate changes to their safety regulations to conform to the new exemptions for agriculture in MAP-21.

AFBF presents case on Chesapeake Bay regulations Continued from page 1 AFBF believes that states in the Chesapeake Bay watershed, not the federal government, are authorized by law to decide how best to achieve water quality goals.

“The Clean Water Act put states in the driver’s seat when it comes to decisions about how to achieve clean water and restrictions on land use and development,” according to Don Parrish, senior director of regulatory relations for AFBF. AFBF delivered the oral arguments and answered questions during a lengthy session before Judge Sylvia H. Rambo in the U.S. District Court for the Middle District of Pennsylvania in Harrisburg, Pa. More than a dozen Pennsylvania farmers, as well as staff from several state Farm Bureau organizations within the water-

“Farmers in the watershed have clearly delivered a documented track record of continuous improvement, through conservation and sound stewardship and will continue their dedicated efforts.”

• AFBF President Bob Stallman shed, attended the argument to show their support for the legal challenge.

“Judge Rambo clearly believes this case is important and involves complex legal questions,” said AFBF General Counsel Ellen Steen. “She had carefully studied the parties’ arguments and was active in her questioning.

At the end of a very long day of arguments, she told the parties not to expect a quick decision.”

In an opening brief for summary judgment filed in January in the case, AFBF said EPA’s TMDL

regulatory action for the Chesapeake Bay will affect all economic activity in the watershed with potentially devastating impacts for the region’s agriculture.

“We all want a clean and healthy Chesapeake Bay,” said AFBF President Bob Stallman. “This lawsuit is about how we reach that common goal. Farm Bureau believes EPA’s regulation is unlawful and costly without providing the environmental benefit promised. Farmers in the watershed have clearly delivered a documented track record of continuous improvement, through

West Nile outbreak highlights need for reg overhaul Continued from page 1 over or near water. As a result of EPA’s failure to defend its own regulations, many pesticides that comply with the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) are now also subject to duplicative regulation under the Clean Water Act, potentially subjecting pesticide users to lawsuits from environmental activists.

At its late September annual meeting, the National Association of State Departments of Agriculture called attention to the “public health need for urgent action to clarify that FIFRA is the appropriate statute under which to regulate pesticide applications.”

A Farm Bureau-backed bill authored by Gibbs would do just that. The Reducing Regulatory Burdens Act of 2011 (H.R. 872) would amend FIFRA and the Clean Water Act to clarify that Clean Water Act permits are not needed when a pesticide is applied in accordance with the FIFRA-approved label.

“Both the farmer risking a lawsuit by applying a pesticide according to the federally approved label and the city manager who can’t afford the extra permit costs to keep people safe from West Nile have the same problem: a duplicative permit requirement that does nothing to further protect the environment or water quality, or to enhance food safety,” said Don Parrish, American

Farm Bureau Federation water quality specialist.

The Reducing Regulatory Burdens Act of 2011, which would be a very narrow fix to the National Cotton Council v. EPA case, passed in the House, but the Senate did not consider the bill.

“Both chambers are adjourned through the election and as important as the bill is, we remain hopeful that it will be considered as part of another piece of legislation moving during the lame-duck session,” said Tyler Wegmeyer, AFBF crop protection specialist.

“But with no less than 48 states battling West Nile outbreaks, we’ll also be prepared to push it through next Congress.”

conservation and sound stewardship and will continue their dedicated efforts.”

The TMDL dictates how much nitrogen, phosphorous and sediment can be allowed into the bay and its tributaries from different areas and sources. According to the brief, TMDL proposals are “informational tools” under the Clean Water Act. But, in this action, EPA’s final TMDL goes far beyond traditional and lawful scope and authority.

“It imposes detailed pollutant ‘allocations’ among sources throughout the bay’s vast watershed,” the brief charged. “These mandatory allocations of allowable pollutant loading among farms, towns and homeowners amount to nothing short of a federal TMDL implementation plan.

This plan directly encroaches on state authority over land and water quality planning—not only in states bordering the bay, but in states hundreds of miles away.

EPA’s action is not authorized under the (Clean Water) Act.” The brief also charged that EPA’s TMDL is based on flawed technical analysis and computer models. “(EPA) used those models for purposes beyond their predictive capabilities and relied on key assumptions that are demonstrably false,” the brief stated. “Those modeling defects are fatal, even if EPA had the authority (which it does not) for the final TMDL.” Joining AFBF as plaintiffs in the case are the Pennsylvania Farm Bureau, The Fertilizer Institute, National Pork Producers Council, National Corn Growers Association, National Chicken Council, U.S. Poultry & Egg Association, National Turkey Federation and the National Association of Home Builders.

Capital Gains Farmers, ranchers stress urgent need for lame-duck action on estate tax, cap gains rates Unless Congress takes quick action during its post-election lame duck, at the beginning of the new year the estate tax exemption will shrink to $1 million per person with no spousal transfer and the top rate will jump to 55 percent, putting the future of hundreds of the nation’s family farms and ranches at risk.

As part of a newly launched American Farm Bureau Federation campaign, farmers and ranchers are hitting their lawmakers hard with e-mails and phone calls that underscore the urgent need for estate tax reform.

“AFBF will focus its grassroots resources and encourage farmers and ranchers to take action and protect farms and ranches from damaging tax increases,” AFBF President Bob Stallman said in launching the campaign. “As we work together on this effort, we need state Farm Bureau leaders and members to engage and help us bring certainty to the future of death taxes, to better transfer farm operations from one generation to the next

“As we work together on this effort, we need state Farm Bureau leaders and members to engage and help us bring certainty to the future of death taxes, to better transfer farm operations from one generation to the next and ease the transition following the death of a family member.” • AFBF President Bob Stallman and ease the transition following the death of a family member.”

Through the end of the year, the estate tax exemption is $5 million per person and the top rate is 35 percent. Also in effect only through Dec. 31 is a provision allowing a surviving spouse to use the unused portion of a spouse’s exemption.

Until estate taxes are permanently eliminated, farmers want Congress to keep or improve the current exemption, indexed for inflation, maintain spousal transfer and continue the top tax rate.

If Congress does not do so by the end of the year, many more surviving farm family members could be forced to make critical decisions on selling land, buildings or equipment to generate enough money to pay the tax.

“A higher exemption and lower rates will give family farms and

ranches a better chance to remain in operation when transferring from one generation to the next,” explained Pat Wolff, AFBF tax specialist.

The estate tax burden falls heavily on farmers because it takes a lot of capital assets, such as land and equipment, to generate the same dollar in income that another type of business could generate with less.

With capital gains taxes too, farm and ranch owners are disproportionally affected. Under current law, on Jan. 1, 2013, the top long-term capital gains tax rate will rise from the current 15 percent to 20 percent, and the dividends tax rate will more than double to 39.6 percent.

Nationwide, 40 percent of all agricultural producers report some capital gains, nearly double the share for all taxpayers. And the average amount of capital gains

reported by farmers is about 50 percent higher than the average capital gains reported by other taxpayers, according to AFBF. On average, farmers own their farmland for 30 years, during which land values can increase significantly. As many growers depend on the liquidation of farm assets to finance their retirement, for many land is their 401K. “If you increase the tax owed when the land is sold, you’re just taking money that he or she needs for retirement, and you’re creating a disincentive to sell land to beginning farmers who can’t pay a higher price to cover a retiring farmer’s capital gains taxes,” Wolff said.

AFBF’s FBACT Insider website, fbactinsider.org, is the easiest way to let Congress know how devastating the impending estate tax and capital gains rate hikes are to agriculture. On the site, you’ll find a “Tax Issues” section, which, once you click on it, will provide you with background information, as well as an “Action Alert” that will allow you to send e-mails to your senators and representative.

October 22, 2012

S P E C I A L

R E P O R T

s & Estate Taxes

Should death be taxed? Farm families say ‘no’

By Glen Cope Two things in life that often bring about the most grief are death and taxes. So when these two are combined, it makes for a cocktail of anxiety. Isn’t it enough that a family must deal with the grieving that comes from the passing of a loved one? Yet political leaders in Washington, D.C., find it necessary to exacerbate that grief by taxing the occasion.

Most young farmers and ranchers have worked from an early age alongside their parents on the family farm, making it a joint effort to improve the farm, pay bills and reduce debt. Not only do young farmers have a vested interest in the farm, they consider themselves co-owners. So you can imagine our frustration knowing that the inevitable is lurking behind the barn door. After our parents pass on, the Internal Revenue Service will demand a sizable portion of the family farm.

Farmers are, as the old phrase goes, “asset rich and cash poor.” Unfortunately, when parents pass, the estate tax is triggered because of high land prices—a fact that most people in this country don’t understand.

The average age of the American farmer is 57.

So, at an age when most Americans are pre-

paring for retirement, farmers are still hard at work. As the average age of farmers increases, the need for permanent repeal of the estate tax is all that much more important, especially if we want young people to return to the farm. Stifling their ambitions by imposing a death tax that penalizes their achievement is not an incentive.

On Jan. 1, 2013, the death tax will fall back to its original position of having only a $1 million exemption toward the value of the estate, and then it will be taxed at a rate of 55 percent.

To give you an idea how little a $1 million exemption will go toward easing the mindnumbing pain felt by this hideous tax: If a farm valued at $3,000 per acre fell under the death tax, only roughly 333 acres would be exempt. However, many farmers will tell you in today’s world, 333 acres will not go very far to support one family, let alone two and sometimes three generations that may rely on the farm to provide their livelihoods.

There are many events in which taxation can come into play throughout a person’s life. For example, sales tax when we make a purchase and capital gains tax when we sell something at a higher price than what we paid. When we own something, we even pay a property tax.

We pay Social Security taxes toward our retirement.

So the question must be asked: If we are taxed in this country seemingly every time we make a move when it comes to spending, saving and making money, should we be taxed simply because we have taken our last breath? Should we make it more difficult for our children to continue the family farm?

The majority of farmers and ranchers would argue the answer is most definitely no!

Glen Cope, a fourth-generation beef producer in Missouri, chairs the American Farm Bureau Federation Young Farmers & Ranchers Committee.

Maintaining cap gains rates key to economic growth

By Jim McCreary Congressional tax writers recently met to discuss an important, timely issue—the taxation of capital gains. The current 15 percent tax rate on capital gains income expires in January, part of a host of tax increases that will hit millions of American taxpayers and businesses if we go over the fiscal cliff. This discussion will hopefully spur lawmakers into action to avoid the fiscal cliff and the damage it will inflict on our economy.

In 2003, Congress and the president took two important steps to boost economic growth. First, they lowered the maximum rate on capital gains to 15 percent.

Second, they tied capital gains and dividend income together, lowering the rate on dividends from the top income tax rate to 15 percent. These rates expire in 2013, increasing the capital gains tax from 15 percent to 20 percent and more than doubling the top dividend rate from 15 percent to 39.6 percent. In addition, beginning in 2013 investment income will be subject to an additional Medicare HI tax of 3.8 percent, raising the top rate on dividend income from 39.6 to 43.4 percent and capital gains to 23.8 percent.

This could have a significantly negative impact on economic growth. According to the Heritage Foundation, higher investment tax rates would lead to 270,000 fewer jobs in 2018.

In addition to harming the economy, the impact of capital gains tax increases would be borne by

millions of Americans, across all income levels. According to IRS data, in 2009, more than 3 million returns with long-term capital gains were filed. Sixty-two percent of those returns were from taxpayers with adjusted gross income of less than $100,000.

American farmers and ranchers would be disproportionally impacted by capital gains tax increases. Nationwide, 40 percent of all agricultural producers report some capital gains; nearly double the share for all taxpayers. The average amount of capital gain reported by farmers is about 50 percent higher than the average

capital gain reported by other taxpayers. The impact of capital gains taxes on farming and ranching is also significant because production agriculture requires large investments in land and buildings that are held for long periods of time.

Higher capital gains taxes also make the U.S. less competitive.

According to a report by Ernst & Young, the U.S. capital gains tax rate compares unfavorably with that of many other major economies. Even with current rates, more than half of the countries surveyed have individual capital gains tax rates lower than that of

the U.S. Allowing rates to increase would undermine efforts to keep the U.S competitive with our trading partners.

As Congress considers efforts to improve the tax code and promote economic growth, we urge members to maintain current low rates on capital gains.

Jim McCrery is manager of the Alliance for Savings and Investment. As a member of the House, Rep. McCrery (R-La.) served on the Ways and Means Committee from 1993 through 2008, and from 2007 through 2008 he was ranking member of the committee.

Stallman urges farmers to engage on estate taxes “A higher death tax exemption level and a lower rate need to be put in place now,” American Farm Bureau Federation President Bob Stallman said in launching the organization’s campaign to urge Congress to act on death taxes during its upcoming lame-duck session. “Farmers and ranchers need the certainty of a low rate and high exemption on death taxes to protect family farms. That is the only way we can effectively prepare for the future and pass along our farms and ranches from one generation to the next.”

To view Stallman’s video, go to http:// fbvideos.org/estate-taxes/.

Capitol View

October 22, 2012

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Court allows AFBF to join farmer lawsuit against EPA The U.S. District Court for the Northern District of West Virginia has ruled that the American Farm Bureau Federation has a right to join in a lawsuit over the scope of the Environmental Protection Agency’s authority to regulate poultry and livestock farms under the Clean Water Act. In July, AFBF asked for permission to join on the side of West Virginia poultry grower Lois Alt, who brought suit to challenge an EPA order demanding that she obtain a CWA discharge permit for stormwater runoff from her farmyard. The West Virginia Farm Bureau has also joined the lawsuit. EPA aggressively opposed the Farm Bureaus’ participation.

“The court clearly recognizes the importance of this case for thousands of other livestock and poultry farmers threatened

by EPA’s unlawful restriction of the agricultural stormwater exemption,” said AFBF President Bob Stallman. “The court flatly rejected EPA’s argument that other farmers facing similar EPA demands should be forced to file their own lawsuits. We are pleased that Farm Bureau

will be allowed to challenge EPA’s actions on behalf of all our farmer and rancher members,” he added.

Alt sued EPA in June after the agency ordered her to obtain a National Pollutant Discharge Elimination System discharge permit. EPA’s order threatens Alt with $37,500 in fines for each time stormwater comes into contact with dust, feathers or dander on the ground outside of her poultry houses, or small amounts of manure that may be present in the farmyard as a result of normal poultry farming operations. EPA also seeks separate fines if Alt fails to apply for an NPDES permit.

According to AFBF’s intervention papers, EPA’s order to Alt represents the latest EPA attempt to regulate non-discharging farmers— this time by unlawfully narrowing the statutory exemption for “agricultural stormwater discharges.”

EPA has claimed here that the agricultural stormwater exemption does not apply to larger farms that qualify as concentrated animal feeding operations, except for certain “land application areas” where crops are grown.

According to Judge John Preston Bailey, AFBF and WVFB demonstrated that a ruling upholding

W.Va. poultry grower Lois Alt, whose farm is pictured here, sued EPA after the agency ordered her to obtain a National Pollutant Discharge Elimination System discharge permit. The American Farm Bureau Federation has been allowed to join the suit.

EPA’s order would harm numerous other farmers and ranchers. Under EPA’s reasoning, Bailey stated, “virtually every large [CAFO] would likely have an obligation to obtain a federally mandated permit if it rains enough in their area to wash manure and dust particles off their land and eventually into a jurisdictional water.”

In allowing AFBF’s participa-

tion, Judge Bailey noted that AFBF is a “veteran advocate in the courts on issues related to CWA permit requirements for CAFOs.” Stallman agreed and noted, “We are proud of our past efforts on behalf of farmers and ranchers, and we are honored that the court recognizes that we bring something useful to the table.”

Farmers, ranchers rally around labor proposal Continued from page 1 to hire harvesters for only a few days to a large dairy in upstate New York that needs a workforce 365 days of the year,” explained Kristi Boswell, AFBF labor specialist.

At-will workers would have to spend at least 30 cumulative days in their home country each year, while contract employees would be required to spend 30 cumulative days at home every three years. This distinction re-establishes a cyclical workforce and accounts for the seasonal nature of much of agriculture.

For their part, employers would see a more efficient and cost-effective recruitment process than re-

quired under the H-2A program and they would not be obligated to provide housing or transportation. Employers would pay at least the higher of the federal or state minimum wage.

Among the most important features of the proposal is an allowance for migrant workers who have been working in U.S. agriculture for a defined period, as well as those who are in management and other key positions at a farm, to stay in the U.S. and continue to work in the agriculture sector.

These work authorizations, called “Ag Cards” in the proposal, would be valid for five years at a time and they would be renewable.

As critical as the details of the plan is the consensus it represents.

“This proposal is the first step in a process that will involve discussions with other agriculture and labor advocacy groups,” explained Boswell. “From there, we, along with other agriculture groups, will take it to Capitol Hill.

New York dairy farmers will be able to tell their lawmakers, ‘This will work for us.’ And Washington apple growers and all types of farmers and ranchers between the Empire State and the Evergreen State will be able to say, ‘This is what we need.’”

The one certain outcome of this election is that farmers and

ranchers are going to be calling on Congress—newly elected and veteran lawmakers alike, Republican and Democrat—to solve the ag labor crisis.

“We envision the new Congress as an opportunity to finally address farmers’ and ranchers’ labor concerns, which are ultimately the concerns of everyone in this country who eats our affordable and safe food,” Boswell explained.

“This proposal provides lawmakers a reasonable, practical, common-sense solution that works for growers while respecting the rights of workers. Agriculture and consumers deserve a legal, stable workforce.”

News Briefs Tyson Foods announces audit program for supplier farms

NASS gathering data on fertilizer, pesticide use

Officials with Tyson Foods announced earlier this month that the company is launching an audit program to evaluate how animals are treated on suppliers’ farms.

According to a statement issued by Donnie Smith, Tyson president and CEO, “We believe the farmers who supply us are the best in the world, and I think the audits will verify this.” Tyson works with more than 12,000 independent livestock and poultry farmers. This includes 5,000 family poultry farmers, 3,000 family hog farmers and 4,000 family cattle farmers. The company employs more than a dozen veterinarians and has maintained an Office of Animal Well-being since 2000.

Farmers in 26 states will soon be asked to provide information to USDA’s National Agricultural Statistics Service about their use of fertilizer and pesticides on soybeans and wheat. The Agricultural Resource Management Survey is conducted to ensure that decisions about agricultural chemical use are based on current, unbiased data gathered from farmers, according to Chris Messer, NASS program administration branch chief. Hundreds of NASS interviewers will visit selected growers over the next three months for in-person interviews. Farmers will be asked to report nutrient or fertilizer use, biocontrol or pesticide applications and pest management, and irrigation practices on one randomly selected field to represent data from their farm.

The data will only be used for statistical purposes. NASS publishes only aggregate information on state and national levels.

All eyes remain on the weather with hopes for better 2013 USDA’s October monthly crop report projected corn ending stocks at 619 million bushels, equal to about 20 days of inventory at the end of the marketing year. Soybean ending stocks were projected at 130 million bushels, equal to about 16 days of stocks available at the end of the marketing year. “All eyes remain on the weather both here in the U.S. and in South America. Large corn and soybean crops in Argentina and Brazil are needed to help meet the very strong global demand for corn and soybeans,” said Todd Davis, an American Farm Bureau Federation economist. Closer to home, “A large portion of the Corn Belt and Great Plains states is also dry and would benefit from increased rains to allow the soil to recharge the soil moisture to set the stage for a better 2013 crop year,” he explained.

GAO report reveals holes in national ag security A new report from the Government Accountability Office reveals that the Department of Homeland Security and Agriculture Department have made some improvements over the past several years in the Agriculture Quarantine Inspection Program but problem areas remain. The agencies need to improve protection from accidental or deliberate introduction of pests or diseases; improve data collection and training for the canine program; and implement new staffing plans. The changes must be implemented to avoid lost agricultural revenue, according to the report.

October 22, 2012

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State quota, Navigator status

State FB Links

As of Oct. 9, 2012 Quota states Alaska, 344 member families Arizona, 22,140 member families Colorado, 22,892 member families Delaware, 6,962 member families Florida, 147,119 member families Iowa, 154,424 member families Louisiana, 148,406 member families Maryland, 37,211 member families Mississippi, 199,502 member families Missouri, 104,160 member families Montana, 16,896 member families Pennsylvania, 55,398 member families South Dakota, 12,376 member families Wisconsin, 44,169 member families Navigator states Florida, 147,119 member families Montana, 16,896 member families Pennsylvania, 55,398 member families

State Focus

Newsmakers

California Farm Bureau commends forestry reforms

Pennsylvania FB pushes for farm vehicle code reform

Crucial property rights on Virginia ballot

Forestry-reform legislation signed by Gov. Jerry Brown will offer relief to Californians and is an important boost to rural regions, according to Paul Wenger, California Farm Bureau Federation president. “The new law will benefit an important enterprise that prides itself on environmental stewardship while providing good-paying jobs in rural areas with high unemployment,” Wenger said. The bill extends the length of state-required timber harvest plans, pays for plan review through a 1 percent assessment on retail lumber purchases and limits wildfire liability for landowners neighboring government-owned lands. “By placing reasonable limits on the amount of damages the federal government can seek from private landowners, the reforms should reduce hidden costs for consumers that are passed along in utility bills and wildfire insurance rates,” Wenger said. He said the new law will allow the timber harvest planning process to be streamlined and improved, generating economic activity while maintaining environmental protection.

Carl Shaffer, Pennsylvania Farm Bureau president, called on the Pennsylvania General Assembly to reform the state’s vehicle code laws. Shaffer stressed the need to modernize the laws governing width allowances for farm equipment and increase the distance that farm equipment and trucks primarily used around the home farm can travel. “PFB is asking for the help of our legislature, who has already been discussing this on a bipartisan basis, to take up this issue and get the relief that is sorely needed for Pennsylvania agriculture,” Shaffer said.

With only a few legislative days remaining, Farm Bureau is urging lawmakers to reach a quick consensus on separate bills passed in the Senate and House of Representatives. “While newer farm equipment has enabled farmers to increase productivity, especially during the planting and harvest seasons, they are larger than vehicles typically used by farmers 30 years ago,” Shaffer said. Pennsylvania’s current vehicle code standards have not been updated since the 1970s and do not reflect the type of equipment that farmers are using in their operations. PFB is making this a top legislative priority.

With just a few weeks left before Election Day, Virginia Farm Bureau members are putting on a full-court press in support of ballot Question 1, which would lock in Virginians’ private property rights under the Virginia constitution and curb the potential for eminent domain abuse.

The Virginia Farm Bureau Federation is a leading supporter of the proposed property rights amendment, which has been in development for seven years.

Approval of Question 1 on the November ballot would incorporate current law into the Virginia constitution, ensuring it could not be easily changed, according to Trey Davis, VFBF assistant director of governmental relations. “Basically it states that private property may only be taken under eminent domain by government or utilities for public use, excluding any possibility of land being condemned for private benefit,” Davis said. “It also requires just compensation to landowners, not only for their property, but also for lost economic opportunities if the taking limits their business practices. And it prohibits taking any more property than is necessary for the public project.”

Bonnie Dyebedahl joined the South Dakota Farm Bureau staff as regional manager. She will work primarily with county offices in the eastern part of the state. Dybedahl previously taught high school for 12 years. Wayne Smith is the new executive director for SDFB. Smith served as a director of field services and as coordinator of the Women’s Team for the past 18 years.

Dean Pridgeon, former vice president of Michigan Farm Bureau, passed away on Aug. 25 at the age of 92. Pridgeon actively farmed from 1939 until 2011. A recipient of the Jaycee Michigan Young Farmer of the Year award, Pridgeon was also the Branch County Farm Bureau president, chairman of the Michigan Natural Resources Commission and state director of agriculture.

Indiana Farm Bureau staff attorney Justin Schneider has been elected to the board of directors of the American Agricultural Law Association, a national professional organization that focuses on the legal needs of the agricultural community.

Dr. John Anderson, deputy chief economist at the American Farm Bureau Federation, will be honored at the College of the Ozarks’ homecoming festivities on Nov. 3, receiving the Alumni Association’s Meritorious Award for Distinguished Young Alumnus. Anderson is a 1992 graduate of the college.

‘Feed 155’ for a good cause The Tennessee Farm Bureau Federation kicked off the Feed 155 campaign less than a month ago and has already sold 1,600 vinyl magnets at $5 a piece, with many more sales anticipated once county Farm Bureau boards begin their monthly meetings. The campaign celebrates American farmers’ and ranchers’ productivity, with one grower producing enough food for 155 people.

In honor of National Breast Cancer Awareness Month this October, TFBF is contributing $1 for each magnet sold to the American Cancer Society. TFBF is also encouraging county Farm Bureaus to devote a dollar of each magnet they sell toward a county need.

“Looking ahead, we are planning an ‘I spy 155’ magnet campaign,” said Rehedona Rose, TFBF executive vice president, “Folks will be encouraged to Tweet and post on Facebook the various locations where they see 155 magnets.”

The magnets are sold online at Feed155.com.

Grassroots

October 22, 2012

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What happens on a poultry farm when the electricity goes out? Do dairy farmers ever get to go on vacation? Is using antibiotics for food animals bad for humans? And why don’t we hear more on the news about agriculture?

Guests at the State Fair of Virginia had questions about agricultural practices and prices, and a panel of farmers and other industry professionals provided answers during the Real Virginia Virtual Farm Tour on Oct. 3. The event, hosted by the Virginia Farm Bureau Federation, also featured video tours of six Virginia farms and interviews with the families who operate them.

Panelists were Margaret Ann Smith, a fifth-generation beef producer from Rockbridge County; David Hickman, a vegetable and grain producer from Accomack County; Spencer Neale, a VFBF commodity marketing specialist; Jonah Bowles, a VFBF agricultural market analyst; and Jim Riddell, a Louisa County cattle producer and former assistant director for agriculture and natural resource programs for Virginia Cooperative Extension.

In addition to presenting the tour to a live audience at the State Fair, Farm Bureau broadcast it live via its website, and viewers had the opportunity to ask questions in person and forward them via e-mail, Facebook and Twitter.

When asked how farms with large commercial poultry hous-

photo courtesy of Kathy Dixon, virginia farm bureau

Virginia FB’s virtual farm tour prompts questions, discussion

As part of the Real Virginia Virtual Farm Tour, Virginia growers answered questions from members of the live audience, as well as those watching the tour online. Pictured (left to right) are Sherri McKinney, Real Virginia Virtual Farm Tour host; Margaret Ann Smith, Rockbridge County beef cattle farmer; David Hickman, Accomack County potato grower; and Spencer Neale, VFBF commodity marketing specialist. es deal with electricity losses during severe storms, Neale acknowledged that a storm can be just as catastrophic for a farm as it can for homeowners and other business operators. “And, as we know, sometimes the outcome isn’t good,” and flocks of birds can be lost.

Some poultry operations have backup generators, he noted, but that’s not inexpensive.

Power outages and the costs of dealing with them are concerns shared by many other livestock producers, Smith noted, explaining that her family’s cattle are watered from a well system with elec-

tric pumps and fenced away from streams to protect water quality.

“This derecho that we had was a huge learning curve for us,” she said. “And we are in the process of buying generators.”

Video footage of a dairy farm in Hanover County drove home the fact that a dairy herd gets milked twice a day, every day. If a dairy operator wants to go away for a few days, “they’re going to have to have someone else do that work for them,” which can take some planning, Neale said.

Asked whether her family’s beef herd is treated with antibiotics,

Smith said they are, but only when they are sick.

“That’s our job,” she said, and the animals are treated with approved products as prescribed by a veterinarian. Some of those antibiotics are as much as $1,700 a bottle, she noted, “so we use it sparingly,” and federal regulations prohibit animals with antibiotics in their systems from being sold for food.

One question addressed Hickman’s ability to find workers for his potato, snap bean and grain operation. “We have some school bus drivers and other folks” who have summers off and work on the farm, and a group of farm workers who come to Accomack each summer after doing seasonal work in Florida and then move on to Delaware.

A fair audience member who recalled listening to farm reports on radio news in decades past asked why farm news is scarcer now, except when disasters occur.

One likely reason, Hickman said, is that there are fewer farms. Many of the remaining ones are larger, but that still means fewer families are farming in their communities—or aware of farm issues.

“My children went to public schools and they were some of the few kids in their classes who knew anything about agriculture,” Hickman said.

The virtual tour can be viewed at VaFarmBureau.org, under the “News & Video” tab.

Statement of ownership, management and circulation Title of publication: FBNews Date of filing: Sept. 24, 2012 Frequency of issue: Semimonthly, except monthly in August and December Annual subscription price: $10 Location of known office of publication: American Farm Bureau Federation, 600 Maryland Ave., SW, Suite 1000W, Washington, DC 20024-2555 Location of headquarters or general business office of publisher: American Farm Bureau Federation, 600 Maryland Ave., SW, Suite 1000W, Washington, DC 20024-2555 Names and addresses of the publisher, editor and managing editor: Publisher: American Farm Bureau Federation, 600 Maryland Ave., SW, Suite 1000W, Washington, DC 20024-2555 Editor: Erin Anthony, 600 Maryland Ave., SW, Suite 1000W, Washington, DC 20024-2555 Managing Editor: n.a.

Owner: American Farm Bureau Federation, a non-profit membership organization, located at 600 Maryland Ave., SW, Suite 1000W, Washington, DC 20024-2555 Known bondholders, mortgagees and other security holders owning or holding 1 percent or more of total amount of bonds, mortgages or other securities: None.

The purpose, function and non-profit status of this or-

ganization and the exempt status for federal income tax purposes has not changed during the preceding 12 months.

Total number of copies printed (net press run): Average no. of copies each issue during preceding 12 months, 43,520; single issue nearest to filing date, 44,756.

Paid circulation: (1) Paid or requested outside-county mail subscriptions, average no. of copies each issue during preceding 12 months, 41,257; single issue nearest to filing date, 42,493. (2) Paid in-county mail subscriptions, none. (3) Sales through dealers and carriers, street vendors, counter sales and other non-USPS paid distribution, none. (4) Other classes mailed through the USPS, none.

Total paid and/or requested circulation: Average no. of copies each issue during preceding 12 months, 41,257; single issue nearest to filing date, 42,493.

Free distribution by mail (samples, complimentary and other free copies): (1) Average no. of copies each issue during preceding 12 months, 963; single issue nearest to filing date, 963. Free distribution outside of mail during preceding 12 months, 735; single issue nearest to filing date, 735. Total average no. of copies each issue during preceding 12 months, 1,698; single issue nearest to filing date, 1,698.

Total distribution: Average no.

of copies each issue during preceding 12 months, 42,955; single issue nearest to filing date, 44,191.

Copies not distributed (office use, leftovers, spoiled): Average no. of copies each issue preceding 12 months, 565; single issue nearest to filing date, 565. Total average no. of copies each issue preceding 12 months, 43,520; single issue nearest to filing date, 44,756.

Percent paid and/or requested circulation: Average no. of copies each issue during preceding 12 months, 96.05%; single issue nearest to filing date, 96.16%.

I certify the statements made by me above are correct and complete.

(Signed) Phyllis Brown Assistant Editor FBNews