Conference committee passes Farm Bill, votes expected soon
The agriculture committees of the U.S. House of Representatives and U.S. Senate have announced a bipartisan agreement on a new five-year Farm Bill. According to information released by the committees, the Agriculture Act of 2014 will expand bioenergy production by supporting non-food based advanced biomass energy production, such as cellulosic ethanol and woody biomass power.
The bill has been applauded by several bioenergy groups for provisions that extend eligibility under several energy title programs to renewable chemical and other biobased chemical manufacturers. The Biotechnology Industry organization announced that the conference report on the legislation contains $881 million in mandatory funding for energy programs and extends eligibility to biobased chemical producers under the Section 9003 Biorefinery Assistance Program and Section 9007 Biomass Research and Development Program.
The bill also includes several major reforms outside of the energy title. It eliminates the direct payments program and strengthens risk management tools. It also repeals outdated programs and consolidates duplicative ones, eliminating nearly 100 programs or authorizations. In addition, information released by the agriculture committees indicates the legislation will help farmers and ranchers create jobs while providing certainty for the 16 million Americans working in agriculture. The bill is also expected to strengthen conservation efforts, maintain food assistance for families while addressing misuse in SNAP, and reduce the deficit by billions of dollars in mandatory spending.
"I am proud of our efforts to finish a farm bill conference report with significant savings and reforms," said Rep. Frank Lucas, R-Okla., Chairman of the House Agriculture Committee. "We are putting in place sound policy that is good for farmers, ranchers, consumers, and those who have hit difficult times. I appreciate the work of everyone who helped in this process. We never lost sight of the goal, we never wavered in our commitment to enacting a five-year, comprehensive farm bill. I ask my colleagues to join me in supporting its passage."
"Today's bipartisan agreement puts us on the verge of enacting a five-year Farm Bill that saves taxpayers billions, eliminates unnecessary subsidies, creates a more effective farm safety-net and helps farmers and businesses create jobs," said Sen. Debbie Stabenow, D-Mich., Chairwoman of the Senate Agriculture Committee. "This bill proves that by working across party lines we can reform programs to save taxpayer money while strengthening efforts to grow our economy. Agriculture is a bright spot in our economy and is helping to drive our recovery. It's time for Congress to finish this Farm Bill and give the 16 million Americans working in agriculture the certainty they need and deserve."
The nearly 1,000-page conference report provides details on energy title provisions.
The bill provides the Section 9002 Biobased Markets Program with $3 million in in mandatory funding for each fiscal year 2014 through 2018 along with $2 million in discretionary funding.
The Section 9003 Biorefinery Assistance Program is expanded to include eligibility for renewable chemical and biobased product manufacturing. It defines biobased product manufacturing as the development, construction and retrofitting of technologically new commercial-scale processing and manufacturing equipment and required facilities that will be used to convert renewable chemicals and other biobased outputs of biorefineries into end-user products on a commercial scale. The bill awards the program $100 million in mandatory funding for 2014 and $50 million in mandatory funding each for fiscal years 2015 and 2016. Discretionary funding of $75 million for each fiscal year 2014 through 2018 is also authorized.
The Section 9004 Repower Assistance Program is assigned $12 million in mandatory funding for fiscal year 2014 along with $10 million in discretionary funding for fiscal years 2014 through 2018.
The Section 9005 Bioenergy Program for Advanced Biofuels is given $15 million in mandatory funding for each fiscal year 2014 through 2018, along with $20 million in discretionary funding for each fiscal year 2014 through 2018.
The Section 9006 Biodiesel Fuel Education Program is awarded $1 million for each fiscal year through 2018 and $1 million in discretionary funding for each fiscal year 2014 through 2018.
The Section 9007 Rural Energy for America Program is amended to include a three-tiered application process that reflects the size of proposed projects. Under the first tier, a separate application process is established for projects for which the cost of activity funded is not more than $80,000. The second tier application process applies to projects for which the cost of the activity funded is greater than $80,000 but less than $200,000. A third tier application process would be established for a projects for which the cost of activity funded is equal to or greater than $200,000. The bill assigns $50 million in mandatory funding for 2014 and each fiscal year thereafter, along with $20 million in discretionary funded for each of fiscal years 2014 through 2018.
The Section 9008 Biomass Research and Development program is assigned $3 million in mandatory funding for each fiscal year 2014 through 2017 and $20 million in discretionary funding for each fiscal year 2014 through 2018.
Section 9009 of the bill extends the Feedstock Flexibility Program for Bioenergy Producers through 2018. The program was originally designated as the Section 9010 program in the 2008 Farm Bill.
Section 9010 of the bill funds the Biomass Crop Assistance Program with $25 million for each fiscal year 2014 through 2018. BCAP was originally designated as the Section 9011 program of the 2002 Farm Bill.
Section 9011 of bill repeals the Section 9012 Forest Biomass for Energy program included in the 2002 Farm Bill.
Section 9012 of the legislation updates and funds the Community Wood Energy Program, which was originally established as the Section 9013 program in the 2002 Farm Bill. The bill adds a new section to the program defining biomass consumer cooperatives as a consumer membership organization that provides members with services or discounts related to the purchase of biomass heating products or biomass heating systems. In addition to providing grants for state and local governments to develop wood energy plans and grants to state and local governments to acquire or upgrade community wood energy programs, the legislation adds a provision to the program that allows grants of up to $50,000 for biomass consumer cooperatives to establish or expand their operations, providing consumers with services or discounts relating to the purchase of biomass heating systems, biomass heating products, and the delivery and storage of biomass heating products. A 50 percent match for the grant is required. The bill authorizes $5 million in funds for each fiscal year through 2018.
Section 9013 of the bill repeals the Biofuels Infrastructure Study established in Section 9002 of the 2008 Farm Bill.
Section 9014 of the legislation repeals the Renewable Fertilizer Study established in Section 9003 of the 2008 Farm Bill.
Section 9015 of the bill establishes and Energy Efficiency Report for USDA Facilities. Within 180 of the bill’s passage into law, the Secretary of Agriculture is required to submit a report to the House and Senate agriculture committees on energy use and energy efficiency projects at the USDA’s Washington, D.C., headquarters and major regional facilities.
Several bioenergy and biofuel trade associations have spoken out in support of the new Farm Bill. Jim Greenwood, president and CEO of the Biotechnology Industry Organization, noted that the conference committee agreement represents the successful culmination of two years’ efforts to reauthorize the Farm Bill. “We congratulate the leaders of the House and Senate Agriculture Committees for their hard work on this bill, and we particularly thank Chairwoman Stabenow for championing new economic and employment opportunities in biomanufacturing under the energy title,” he said. “With stable policy and the investments included in this conference report, Farm Bill energy programs will continue to help rural communities create economic growth and good paying jobs. The expansion of eligibility to new renewable chemical technologies and the support for new energy crops will create additional opportunities and improve U.S. economic growth across the country.”
Tom Buis, CEO of Growth Energy, also commended the House and Senate negotiators for finding a solid compromise on the Farm Bill, noting that the legislation provides the necessary incentives to continue to develop fuels from the farm.
“I am pleased to see that the Agriculture Act of 2014 establishes $881 million in mandatory funding for the Energy Title. With this funding, critical programs such as the Biorefinery Assistance Program, Rural Energy for America Program and Biomass Crop Assistance Program will continue to provide the funding necessary for rural America to develop new methods and feedstocks for producing energy from America’s heartland,” Buis said. “The bottom line is that this legislation helps create jobs in rural America and advances first and next generation biofuel production that will help improve our environment and reduce our dangerous addiction to foreign oil. I hope that both the House of Representatives and the Senate can pass this legislation soon, without hesitation, and that President Obama can sign this into law, finally providing rural America with the certainty and federal agriculture policy it deserves.”
The Biomass Power Association praised Congress for its Farm Bill compromise, noting that the bill allots $125 million over five years to the BCAP program. “We thank Congress for funding BCAP in the final draft of its Farm Bill and hope to see its passage soon,” said Bob Cleaves, president and CEO of the BPA. “The program stands to benefit not only biomass facilities but also the federal lands that require maintenance to remain free of catastrophic wildfires. The biomass industry looks forward to working with USDA to implement this program in a sensible, targeted way that avoids unintended consequences.”
The Renewable Chemicals and Advanced Materials Alliance has also applauded key sections of the new Farm Bill. "The inclusion of key provisions in the final Farm Bill helps the country improve its global manufacturing competitiveness, and speed to market higher performing products such as latex-based athletic gear and medical devices, cold water detergents, high strength composites for wind turbines, compostable cups and flatware, recyclable biobased carpets, and even polymers and fibers for emerging applications in light weighting cars and 3D printing," said Corinne Young, chief advocate for the Renewable Chemicals and Advanced Materials Alliance. "These incentives will assist the renewable chemicals sector in taking root firmly here in the US. As the sector grows, innovation hubs and new value chains will develop—creating jobs to meet the growing global demand for better products produced more sustainably.”
The House is expected to vote on the bill as soon as Wednesday, with a Senate vote expected soon after. A full copy of the conference report can be downloaded on the House website.