Friday, May 16, 2008

May Revise

With the release of Governor Schwarzenegger’s revised 2008-2009 State Budget plan on Wednesday, legislative budget negotiations will now commence in earnest. As widely reported the Governor projects a $15.2 billion deficit beginning July 1. His new proposal places about $17.2 billion in program cuts, new revenues and accounting changes “on the table.” The cuts are primarily targeting public health and social welfare programs. New revenues will come from “borrowing” $15 billion from private investors backed by future revenue streams generated from the State Lottery. The fallback alternative is the imposition of a one cent increase in state sales tax. The details of the Governor’s proposal won’t be completely understood until the Legislative Analyst provides a thorough budget analysis.

In the meantime, it appears that the Department of Food & Agriculture’s budget has come through relatively unscathed at this point. Its total budget, as originally proposed in January, amounted to $314.6 million, with $113.8 million appropriated from the State General Fund. In the proposal that was released Wednesday, the Department’s General Fund portion was decreased by $11.2 million or roughly 10%. The actual program cuts weren’t detailed in the information that was released. However, the Department’s total budget was actually increased to $359.2 million. The additional revenue is appropriated from other sources than the General Fund, primarily the State Motor Vehicle Account. The additional funding will be used for “infrastructure expenditures” which includes facilities such as border inspection stations, vet labs, greenhouses, storage facilities, etc.

Over the years there have been a number of fiscal challenges, tough negotiations, heated debates and lengthy stalemates, but unless a minor miracle occurs, this year’s budget process may be the most difficult ever. There’s a lot at stake so I’ll be following this process very closely over the next few months.

Farm Bill

Congress finally passed a new Farm Bill with strong “veto-proof” margins. President Bush is expected to be veto the bill and send it back to Congress for what’s anticipated to be a successful veto over-ride vote. While this remains to be played out, the Farm Bill itself is “generally” supported in California for two primary reasons. First, specialty crops are getting an unprecedented level of support. Secondly, given all other options, this particular Farm Bill is probably the best deal that can be achieved. Since the bill is 673 pages, and the analysis is 423 pages, I’ll briefly highlight just a few programs that are of particular interest:

• Value-added Grants – Mandatory funding of $15 million (which will remain available until expended) is provided in the 2009 fiscal year. Further appropriations are authorized through 2012. However, the Secretary is required to reserve 10% of the funds for projects that benefit beginning or socially disadvantaged farmers or ranchers. An addition 10% is allocated to mid-tier value chains that are strategic alliances (includes cooperatives) that deal in significant volumes of high-quality, differentiated food products and distribute rewards equitably across the supply chain.
   
• Market Access Program – The program eligibility is extended to organic and with mandatory funding at $200 million annually through 2012.
   
• Specialty Crop Block Grants – These grants are allocated to the state departments of agriculture to implement competitive grant programs for the promotion of specialty crops. States will be required to conduct extensive outreach to interested parties and utilize a transparent process for handling grant applications. Also states are strongly encouraged to submit grant plans that cover multi-state or regional activities including but not limited to good agricultural practices, pest and disease management and research. Additionally, states will be discouraged from using the funds to generically promote commodities that fall under state marketing programs, but are outside the scope of the Specialty Crop Competitiveness Act of 2004. Mandatory funding is $10 million in 2008, $49 million in 2009 and $55million from 2010 – 2012.
   
• Specialty Crop Research Initiative – Provides funding to agricultural research and extension institutions for programs relating to plant breeding and genetics, safety, quality and yield; invasive pests; marketing; pollination and production. It also covers programs that address food safety hazards relative to the production and processing of specialty crops. Mandatory funding of $230 million is provided for fiscal years 2008 - 2012.

New Leadership at AFT

The Board of Directors of American Farmland Trust has named Jon Scholl President to succeed Ralph Grossi, who will be stepping down as President after 23 years.
Scholl, an Illinois farmer, has most recently served as the Counselor to the Administrator for Agricultural Policy at US EPA where he led the development of the first EPA National Agriculture Strategy, agricultural advisory committee, and agency-wide cross media agriculture team. In addition, he helped direct Agency regulations on animal feeding operations, spill prevention, clean air rules and emission reporting requirements; and provided input and counsel to the USDA farm bill team on the conservation provisions of the Administration’s 2007 farm bill proposal. Prior to that position, Scholl served for 25 years with the Illinois Farm Bureau as Executive Assistant to the President, and in a variety of other positions including director of public policy, director of national legislation, and director of natural resources.

Heat Stress

In anticipation of the hot days ahead, Howard Rosenberg, a UC Berkeley Cooperative Extension agricultural personnel management specialist, has developed important information relating to steps that can be taken to prevent heat-related discomfort, impaired performance, accidents, and heat illnesses that can affect agricultural workers. In partnership with the California Farm Bureau Federation and with support from the USDA Western Center for Risk Management Education, he compiled key points on heat stress prevention concisely in Spanish and English on pocket-sized fold-out cards. They may be downloaded for free from the UC ANR Web site, http://ucanr.org/heat . The Web site also has links to UC articles titled "Ten key points about heat stress," "UC gives tips for coping with heat stress," "Heat illness symptoms and first aid," and "How heat affects the body." In addition, the Web site has information about audio recordings on heat stress in Spanish and English, which are available by calling the AsisTel toll free phone number (800) 514-4494.