USDA 2007 Farm Bill Proposals - US Department of Agriculture

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REFORM EXPORT CREDIT GUARANTEE PROGRAMSRecommendations in BriefFurther reform the Commodity Credit Corporation’s (CCC) export credit guarantee programs inlight of the findings of the World Trade Organization (WTO) in the Brazil cotton dispute.Terminate the Supplier Credit Guarantee Program (SCGP) due to approximately $227 million indefaults and evidence of fraudulent activity.ProblemThe WTO found that the CCC export credit guarantee programs are not consistent with U.S.obligations under international trade rules. Although the Administration has taken certainadministrative steps to bring the programs into conformity with U.S. obligations, additionallegislative changes would complement those actions and ensure that the programs remain WTOcompliant. As Kid, from Texas noted at a Farm Bill Forum, “We have got to abide by those tradeagreements that we made.”The Supplier Credit Guarantee Program has incurred a large number of defaults and has beensubject to fraud. Total defaults over the life of the SCGP (1996 to present) equal approximately$227 million, with the largest losses occurring in FY 2004 (approximately $79 million) and FY2005 (approximately $122 million). These recent defaults prompted USDA to withholdannouncement of a SCGP program in FY 2006. Of the $227 million in default, approximately $7million has been recovered.Recommended SolutionThe Administration recommends removing the one percent cap on fees that can be collectedunder the short-term Export Credit Guarantee Program (GSM-102) and eliminating the specificauthority for the Intermediate Export Credit Guarantee Program (GSM-103). The Administrationalso proposes termination of the Supplier Credit Guarantee Program.BackgroundIn the Brazil cotton dispute, the WTO found that the CCC export credit guarantee programs areexport subsidies provided in a way that is inconsistent with U.S. trade agreements. The WTO’sfindings apply not just to cotton, but also other U.S commodities that receive export creditguarantees. To comply with these findings, the Administration took a number of steps in July2005 to bring the programs into conformity with U.S. obligations. With respect to the GSM-102program, the Administration implemented a more risk-based fee structure that better reflectscountry risk ratings and length of guarantee coverage and eliminated the highest risk countriesfrom the programs altogether. The Administration further suspended additional guaranteeapplications under the GSM-103 program. To complement these actions, the Administrationsubmitted legislative proposals to Congress in July 2005 and again in March 2006.The Administration proposes eliminating the cap on GSM-102 fees to provide greater flexibilityand assist USDA in maintaining the risk-based fee structure adopted in July 2005. Eliminatingthe specific statutory authority for the GSM-103 program is consistent with the suspension of theprogram in July 2005. Further, participation in the GSM-103 program has been very low inUSDA 2007 Farm Bill Proposals Page 76 of 183
ecent years, and repeal of the specific authority is likely to affect few, if any, food oragricultural interests.The Supplier Credit Guarantee Program is designed to help exporters offer direct, short-termcredit to foreign buyers of U.S. food and agricultural products. USDA's CCC reduces thefinancial risk to exporters by guaranteeing a large portion of the payments due from importersunder financing arrangements of up to 180 days. The direct credit extended by the exporter to theimporter for the purchase of U.S. agricultural products must be secured by a promissory notesigned by the importer. USDA issues the credit guarantee, while the exporter or the exporter’sbank provides the financing. A substantially smaller portion of the value of exports (currently 65percent) is guaranteed under the SCGP than under the GSM-102 program, where the CCC isguaranteeing foreign bank obligations.USDA 2007 Farm Bill Proposals Page 77 of 183
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United States Department of Agricul
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Title IV - Nutrition Programs Tab 4
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TITLE ICOMMODITYPROGRAMSUSDA 2007 F
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prices…Let free market principles
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REVISE MARKETING ASSISTANCE LOANSRe
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panel has been established to rule
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BackgroundProducers may receive a n
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Additionally, to avoid jeopardizing
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BackgroundThe Direct Payment Progra
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If a payment is triggered, the nati
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STRENGTHEN PAYMENT AND ELIGIBILITY
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BackgroundA limitation on the total
Page 25 and 26: Recommended SolutionTo help rectify
Page 27 and 28: MILC payments would be based on 85
Page 29 and 30: program. On January 1, 2008, full i
Page 31 and 32: Europe (USNE). The decision concern
Page 33 and 34: market signals and what was in thei
Page 35 and 36: yield. Therefore, the amount of dir
Page 37 and 38: continue to receive the direct paym
Page 39 and 40: 2. Successor Agreements. -- For pur
Page 41 and 42: SUMMARY OF CONSERVATION TITLE REFOR
Page 43 and 44: ENVIRONMENTAL QUALITY INCENTIVESPRO
Page 45 and 46: development of innovative practices
Page 47 and 48: existing resource concerns to the s
Page 49 and 50: PRIVATE LANDS PROTECTION PROGRAMRec
Page 51 and 52: CONSERVATION RESERVE PROGRAMRecomme
Page 53 and 54: WETLANDS RESERVE PROGRAMRecommendat
Page 55 and 56: IMPLEMENT “SOD SAVER” TO DISCOU
Page 57 and 58: CONSERVATION ACCESS FOR BEGINNING A
Page 59 and 60: MARKET-BASED APPROACH TO CONSERVATI
Page 61 and 62: MERIT-BASED FUNDING ALLOCATIONRecom
Page 63 and 64: farmland, which may include debris
Page 65 and 66: SUMMARY OF TRADE TITLE REFORMRecomm
Page 67 and 68: EXPAND TECHNICAL ASSISTANCE FOR SPE
Page 69 and 70: ENHANCE THE MARKET ACCESS PROGRAMRe
Page 71 and 72: GRANT PROGRAM TO ADDRESS SANITARY A
Page 73 and 74: TECHNICAL ASSISTANCE TO RESOLVE TRA
Page 75: TRADE CAPACITY BUILDING AND AGRICUL
Page 79 and 80: REPEAL THE EXPORT ENHANCEMENT PROGR
Page 81 and 82: PROVIDE CASH AUTHORITY FOR PORTION
Page 83 and 84: TITLE IVNUTRITIONUSDA 2007 Farm Bil
Page 85 and 86: accountable for these errors. (For
Page 87 and 88: FOOD STAMP PROGRAM:Working Poor and
Page 89 and 90: a statistically valid sample of Sta
Page 91 and 92: have driven implementation of syste
Page 93 and 94: problem, and there are few opportun
Page 95 and 96: FOOD STAMP PROGRAM:IMPROVING HEALTH
Page 97 and 98: THE EMERGENCY FOOD ASSISTANCE PROGR
Page 99 and 100: FOOD DISTRIBUTION PROGRAM ON INDIAN
Page 101 and 102: SENIOR FARMERS’ MARKET NUTRITION
Page 103 and 104: PROMOTING HEALTHFUL DIETS IN SCHOOL
Page 105 and 106: TITLE VCREDITUSDA 2007 Farm Bill Pr
Page 107 and 108: Eliminate the $250,000 cap on the v
Page 109 and 110: 3. Unmet SDA or beginning farmer ne
Page 111 and 112: downpayment loan amount of $200,000
Page 113 and 114: meet the credit needs of an increas
Page 115 and 116: SUMMARY OF RURAL DEVELOPMENT TITLER
Page 117 and 118: ADDRESS BACKLOG OF RURAL CRITICAL A
Page 119 and 120: ENHANCING RURAL INFRASTRUCTURERecom
Page 121 and 122: USDA’s community facilities progr
Page 123 and 124: program; and consolidate the Sectio
Page 125 and 126: SUMMARY OF RESEARCH TITLE REFORMRec
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RESEARCH, EDUCATION AND ECONOMICS (
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AGRICULTURAL BIOENERGY AND BIOBASED
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SPECIALTY CROP RESEARCH INITIATIVER
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FOREIGN ANIMAL DISEASE RESEARCHReco
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SUMMARY OF FORESTRY TITLE REFORMRec
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COMPREHENSIVE STATEWIDE FOREST PLAN
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FOREST WOOD TO ENERGYRecommendation
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COMMUNITY FORESTS WORKING LANDSPROG
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SUMMARY OF SUPPORT OF RENEWABLEENER
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CELLULOSIC BIOENERGY PROGRAMRecomme
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EXPANSION OF BIOBASED PRODUCTS MARK
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SUMMARY OF MISCELLANEOUS TITLE REFO
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CROP INSURANCESUPPLEMENTAL DEDUCTIB
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payment. If the county yield is 80
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ACCESS TO CROP INSURANCEDATA MINING
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STRENGTHEN CROP INSURANCEPROGRAM CO
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CROP INSURANCERESEARCH AND DEVELOPM
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CROP INSURANCESTANDARD REINSURANCE
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INCREASE CROP INSURANCE PARTICIPATI
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ENSURING FAIRNESS OF DAIRY RESEARCH
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plan crop plantings and make market
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USDA would also consider offering v
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SUMMARY OF SPECIALTY CROP SUPPORTRe
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Reauthorize the Emergency Food Assi
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SUMMARY OF SUPPORT OF BEGINNING FAR
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SUMMARY XIIISOCIALLYDISADVANTAGEDPR
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eginning farmers buying power by in
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ADMINISTRATION'S FARM BILL PROPOSAL
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ADMINISTRATION'S FARM BILL PROPOSAL
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USDA 2007 Farm Bill Proposals - US Department of Agriculture

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