According to sources, Rep. Larry Combest, conference committee chairman, and Sen. Kent Conrad of North Dakota, were discussing a proposal that would raise the corn loan rate from the $1.89 a bushel in the House bill to $1.98 to $2 per bushel and the soybean loan rate from $4.92 to $5.02 to $5.05.
The levels are still below the $2.08 for corn and $5.20 for soybeans in the Senate-passed bill, but above the 1 percent increase that Combest and other House members of the conference had proposed on April 9.
Conference members spent the better part of that afternoon debating the loan rate issue. House Republicans and White House officials argued that rates in the Senate bill would over-stimulate production of crops, and Senate Democrats saying higher loan rates were the best way to get money into farmers’ hands.
Those discussions were tame compared to the Grassley-Dorgan payment limit bout the following day. House members Saxby Chambliss of Georgia and Charlie Stenholm of Texas sparred with Conrad and Senate Ag Committee Chairman Tom Harkin for nearly two hours on the issue.
Harkin and Conrad went through the now-familiar litany of claims that 70 percent of farm program payments go to the wealthiest 10 percent of producers. But Conrad added a new twist: a description of an actual farming operation in which multiple corporations involving family members were set up to help it qualify for more payments.
“Honestly, this is the kind of thing that costs respect for farm programs, puts the creditability of farm programs at risk and has hurt us all,” he said. “It has hurt those of us who in good conscience come and fight for good farm programs. And we have an obligation to do something about it.”
“I’m sure that those facts are probably right, that we could find any number of scenarios in different parts of the country where on the face of it, there seems to be some abuse of the programs,” said Chambliss. “There a couple of figures left out of the senator’s scenario that would be interesting to know, however.
“No. 1, what was the investment that that farming operation had to make into their farm from an operating standpoint, and No. 2, how much money did that farm lose? I can guarantee you that a farm that size that operated in the Southeast in recent years did not have an operating profit.”
Conrad, who has been considered a friend by southern lawmakers in the past, told conference members that the House payment limits language was “totally unacceptable” to the Senate members. That prompted Rep. Terry Everett of Alabama to reply the Senate bill language was “equally unacceptable” to House conferees.
Both sides did say that neither version would be as they now appear in a final farm bill, but major differences obviously remain.
Reports said a compromise proposal from Senate conference members would allow a separate $100,000 limit for marketing loan gains with a higher repayment rate than the posted county price or adjusted world price besides the $150,000 marketing loan benefit limit in the Senate bill
But the Senate proposal still eliminates the three-entity rule, requiring direct attribution of payments to individuals and requires commodity certificates to count against the marketing loan gain, in effect, making certificates useless. Both are opposed by House conferees.
On Friday, sources were saying that if a compromise could be reached on loan rates, agreements on other issues would quickly fall into place, including one on the Grassley amendment. But some conference member aids said the chasm that remains between the two sides on the payment limit issue could make reaching a final agreement difficult.
Combest, who had scheduled another day of hearings to begin at 10 a.m. on Friday and had talked about working through the weekend, announced that the committee meeting was being postponed until Monday.