Federal Farm Subsidies

The number of farmers that receive subsidies in VA is 30,859.

The percentage of the farmers receiving subsidies exceeding the $250,000 cap we are supporting is 0%. Nada. None.

No one in the state would be negatively effected by the change in legislation, however, many farmers would reap the benefits including less pressure to consolidate or sell their farms.

The bulk of current government farm payments go to the large, industrial farms, over smaller operations that receive little or no support. Current loopholes allow large, industrial farms to draw virtually unlimited commodity payments, despite rules meant to limit payments to $360,000 maximum. In Virginia, 10% of farmers receive 89% of commodity subsidies. In fact, 81% of Virginia farmers receive no government subsidies at all.

(Data compiled by the Environmental Working Group, 2002)

The unintended consequences of this skewed payment distribution are harming our rural communities: higher land prices and consolidation of farms are pushing family farmers off their land. Although commodity payments were meant to help family farms stay in business, misguided subsidies undermine rural economies and accelerate a downward spin for small and medium-sized farms by rewarding mega-farms with the largest payments.

An important step to reversing this trend is to place strict limits on the amount of farm payments any one recipient may receive. This will make sure farm support goes to those who need the help over those who take advantage of the current system. A payment limit of $250,000 per recipient has been proposed by bipartisan Congressional leaders. In addition, President Bush has proposed a similar measure to help meet the $3 billion shortfall in this year’s agriculture budget.

The $250,000 payment cap has been proposed as legislation by Senators Grassley (R-IA), Dorgan (D-ND), and Hagel (R-NE) and Representatives Kind (D-WI) and Flake (R-AZ). The Rural America Preservation Act of 2005 (S.385 and HR 1590) places limitations on the amount of farm commodity subsidies any one recipient may receive, eliminates the cumbersome “three-entity rule” and closes the commodity certificate loophole.

In 2003, no farmer in VA received more than $250,000 in crop subsidies. Payment limits would not impact a single Virginian.

However, thousands of Virginians would feel the impact of budget cuts to conservation and nutrition programs if they are cut at the expense of commodity programs:

(Data compiled by Environmental Working Group and USDA Food and Nutrition Service, 2003)

Capping subsides is a fairer solution to solving the budget shortfall than slashing other agriculture programs. Further, capping commodity subsidies will help to address the problem of low commodity prices, overproduction and agricultural dumping into foreign markets.

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