[Senate Hearing 118-122]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 118-122

     FARM BILL 2023: COMMODITY PROGRAMS, CROP INSURANCE, AND CREDIT

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                                 HEARING

                               BEFORE THE

                       COMMITTEE ON AGRICULTURE,
                        NUTRITION, AND FORESTRY

                          UNITED STATES SENATE

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            February 9, 2023

                               __________

                       Printed for the use of the
           Committee on Agriculture, Nutrition, and Forestry
           
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                  Available on http://www.govinfo.gov/
                  
                              __________

                   U.S. GOVERNMENT PUBLISHING OFFICE                    
53-638 PDF                  WASHINGTON : 2024                    
          
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           COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY


                 DEBBIE STABENOW, Michigan, Chairwoman
SHERROD BROWN, Ohio                  JOHN BOOZMAN, Arkansas
AMY KLOBUCHAR, Minnesota             MITCH McCONNELL, Kentucky
MICHAEL F. BENNET, Colorado          JOHN HOEVEN, North Dakota
KIRSTEN E. GILLIBRAND, New York      JONI ERNST, Iowa
TINA SMITH, Minnesota                CINDY HYDE-SMITH, Mississippi
RICHARD J. DURBIN, Illinois          ROGER MARSHALL, Kansas
CORY BOOKER, New Jersey              TOMMY TUBERVILLE, Alabama
BEN RAY LUJAN, New Mexico            MIKE BRAUN, Indiana
RAPHAEL WARNOCK, Georgia             CHARLES GRASSLEY, Iowa
PETER WELCH, Vermont                 JOHN THUNE, South Dakota
JOHN FETTERMAN, Pennsylvania         DEB FISCHER, Nebraska

                 Erica Chabot, Majority Staff Director
                 Chu-Yuan Hwang, Majority Chief Counsel
                    Jessica L. Williams, Chief Clerk
               Fitzhugh Elder IV, Minority Staff Director
                 Jackie Barber, Minority Chief Counsel
                            
                            
                            C O N T E N T S

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                      Wednesday, February 9, 2023

                                                                   Page

Hearing:

Farm Bill 2023: Commodity Programs, Crop Insurance, and Credit...     1

                              ----------                              

                    STATEMENTS PRESENTED BY SENATORS

Stabenow, Hon. Debbie, U.S. Senator from the State of Michigan...     1
Boozman, Hon. John, U.S. Senator from the State of Arkansas......     3

                                WITNESS

Bonnie, Hon. Robert, Under Secretary For Farm Production and 
  Conservation, U.S. Department of Agriculture, Washington, DC...     5
Bunger, Marcia, Administrator, Risk Management Agency, U.S. 
  Department of Agriculture, Washington, DC......................     5
Ducheneaux, Zach, Administrator, Farm Service Agency, U.S. 
  Department of Agriculture, Washington, DC......................     5
                              ----------                              

                                APPENDIX

Prepared Statements:
    Bonnie, Hon. Robert..........................................    38

Question and Answer:
Bonnie, Hon. Robert:
    Written response to questions from Hon. Debbie Stabenow......    54
    Written response to questions from Hon. John Boozman.........    57
    Written response to questions from Hon. Sherrod Brown........    59
    Written response to questions from Hon. Michael F. Bennet....    60
    Written response to questions from Hon. Kirsten E. Gillibrand    61
    Written response to questions from Hon. Ben Ray Lujan........    67
    Written response to questions from Hon. Peter Welch..........    68
    Written response to questions from Hon. John Hoeven..........    71
    Written response to questions from Hon. Roger Marshall.......    72
    Written response to questions from Hon. John Thune...........    73
    Written response to questions from Hon. Deb Fischer..........    74
Bunger, Marcia:
    Written response to questions from Hon. Debbie Stabenow......    77
    Written response to questions from Hon. John Boozman.........    78
    Written response to questions from Hon. Sherrod Brown........    80
    Written response to questions from Hon. Michael F. Bennet....    81
    Written response to questions from Hon. Cory Booker..........    81
    Written response to questions from Hon. Peter Welch..........    84
    Written response to questions from Hon. Roger Marshall.......    85
    Written response to questions from Hon. John Thune...........    85
Ducheneaux, Zach:
    Written response to questions from Hon. Debbie Stabenow......    88
    Written response to questions from Hon. John Boozman.........    94
    Written response to questions from Hon. Michael F. Bennet....    98
    Written response to questions from Hon. Raphael Warnock......   100
    Written response to questions from Hon. Peter Welch..........   102
    Written response to questions from Hon. John Hoeven..........   102
    Written response to questions from Hon. Roger Marshall.......   103
    Written response to questions from Hon. Tommy Tuberville.....   104
    Written response to questions from Hon. John Thune...........   106

 
     FARM BILL 2023: COMMODITY PROGRAMS, CROP INSURANCE, AND CREDIT

                              ----------                              


                       Thursday, February 9, 2023

                                        U.S. Senate
         Committee on Agriculture, Nutrition, and Forestry,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 9:30 a.m., in 
room 328A, Russell Senate Office Building, Hon. Debbie 
Stabenow, Chairwoman of the Committee, presiding.
    Present: Senators Stabenow [presiding], Brown, Klobuchar, 
Bennet, Smith, Lujan, Warnock, Welch, Boozman, Hoeven, Ernst, 
Hyde-Smith, Marshall, Tuberville, Braun, Grassley, Thune, and 
Fischer.

STATEMENT OF HON. DEBBIE STABENOW, U.S. SENATOR FROM THE STATE 
    OF MICHIGAN, CHAIRWOMAN, U.S. COMMITTEE ON AGRICULTURE, 
                    NUTRITION, AND FORESTRY

    Chairwoman Stabenow. Good morning. I call this hearing of 
the U.S. Senate Committee on Agriculture, Nutrition, and 
Forestry to order. Let me also clarify--what are you wearing?
    [Laughter.]
    Senator Marshall. I had the Chiefs tie----
    Chairwoman Stabenow. You know, we are a proper Committee 
here. We usually have suits and ties and so on. Given the 
situation we will have a little latitude. Anyone on the other 
side who has a shirt they would like to--okay.
    First I do want to clarify, because we have a number of 
members on Judiciary Committee that are on our Committee. We 
are happy to have them. Thursdays have become difficult because 
of competing committee hearings, and so on. We have, as a 
courtesy, opened up--Senator Boozman and I agreed to allow 
folks to check in and get in line 15 minutes ahead of the 
beginning of the meeting in order to accommodate that. 
Judiciary members or any other members do not need to wait 
until we bring the gavel down. We are going to allow folks to 
check in 15 minutes early.
    Just make sure everybody knows that we are trying to 
accommodate. We are going to avoid Thursdays as much as we can, 
going forward, but the Committee times and so on and keep 
changing. We will do our best to accommodate as many members as 
possible being able to be with us.
    Last week the Committee held a hearing on trade and 
horticulture policy. Today we hold our fourth farm bill hearing 
and we are going to focus on the backbone of the farm safety 
net, the commodity, crop insurance, and credit titles. I would 
like to welcome our witnesses, Under Secretary Robert Bonnie--
we are so pleased to have you back--Administrator Marcie 
Bunger, and Administrator Zach Ducheneaux. Thank you so much 
for all being here. The Committee appreciates your time. We 
know you share our goal of putting together an effective, 
strong, bipartisan farm bill, so thank you so much.
    Some of our country's earliest agricultural policies date 
back more than a century, when Congress provided help to 
farmers to meet their credit needs, and later, in the 1930's, 
when Congress provided assistance to address weather disasters 
and plummeting prices. A lot has changed since that time, but 
farming remains one of the riskiest businesses and farmers 
still need these tools.
    Droughts, floods, and early thaw followed by a late freeze 
or other serious weather events can wipe out a farmer's bottom 
line. We certainly have seen that in Michigan, and I know my 
Senate colleagues have seen that as well.
    Global events can cause dramatic swings in commodity 
prices, risking farmers' livelihoods and harming communities. 
The climate crisis has made this threat even more dire for 
farmers across the country.
    I am proud of common-sense, bipartisan reforms this 
Committee has implemented over the last two farm bills, to make 
the farm safety net fair and more equitable for all farmers. We 
ended direct payments that either paid too much or too little, 
regardless of actual losses. We placed a focus on risk 
management and improved crop insurance options, created new 
tools like permanent livestock disaster programs and expanded 
coverage for underserved farmers through the Noninsured Crop 
Disaster Assistance Program. We added more crops and improved 
upon new coverage options like whole-farm insurance for 
diversified producers. We created the Agriculture Risk Coverage 
Program to protect against both price and yield loss.
    I am also part of the work of this Committee in what we 
have done to secure the dairy safety net. In the 2018 Farm Bill 
we dramatically improved support for dairy producers and 
expanded crop insurance options for dairy.
    A lot has changed, though, since the passage of the 2018 
Farm Bill. We have seen nearly $70 billion in ad hoc assistance 
to producers outside of the farm bill programs, and this is 
something we need to look at in terms of need and what has 
happened as we go forward on all of these important programs. 
Over the last three years we have seen 50 individual billion-
dollar weather and climate disaster events. Think about that--
50 different events. This has led to $13 billion in ad hoc 
disaster assistance for our farmers.
    Trade wars started by the last administration caused 
dramatic drops in crop prices and resulted in $23 billion in ad 
hoc trade and payments to producers. The pandemic assistance 
packages passed by Congress delivered more than $31 billion in 
assistance to our producers.
    I raised many concerns during these ad hoc programs to make 
sure that they were distributed fairly, and I was concerned at 
that time that they were not distributed fairly, and that is 
something we certainly, going forward, are going to be keeping 
an eye on, to make sure it is fair. We are not interested in 
picking winners and losers or favoring certain crops over other 
or funneling money to larger operations over smaller farms. 
This was something that was confirmed by the Government 
Accounting Office, so we want to make sure we are moving 
forward in the right way, and I am sure we will.
    There are still gaps in the farm safety net as farmers 
continue to face global market uncertainty and climate-fueled 
weather disasters. While many commodity prices are at historic 
highs, which is good, we also know that land and fertilizer and 
input costs are also near record highs. We need to work 
together to create a farm safety net that is responsive to the 
needs of all of our farmers.
    Crop insurance is the No. 1 risk management tool for 
producers, but historically has not been available to some 
farmers who are most in need of it. I am going to continue to 
focus on expanding and strengthening crop insurance for all our 
farmers, including specialty crop growers, organic producers, 
beginning and diversified farmers.
    Farmers must have the opportunity to start, sustain, and 
expand their operations. The farm bill provides a variety of 
resources for farmers to access credit, through loans, 
microloans, and training to help new farmers get started in 
agriculture. These programs need to be accessible and 
equitable, again, to all farmers, from major commodities to 
specialty crops to dairy to livestock and everything in 
between.
    This Committee has a challenging task ahead and an 
important one that I know that we are up to, and I am looking 
forward to working with all of you and with my friend, the 
Ranking Member, Senator Boozman, to deliver a strong, 
bipartisan farm bill that strengthens and builds on our farm 
safety net.
    Senator Boozman.

STATEMENT OF HON. JOHN BOOZMAN, U.S. SENATOR FROM THE STATE OF 
                            ARKANSAS

    Senator Boozman. Thank you, Madam Chair, and Under 
Secretary Bonnie, Administrator Bunger, Administrator 
Ducheneaux, I thank you all for being here, and we really do 
appreciate the great work that you are doing.
    America's farmers rely on the safety net created by the 
commodity, crop insurance, and credit programs that you 
oversee. The tremendous financial risk inherent to agriculture 
has only increased since the last farm bill due to rapidly 
increasing input costs. The 2023 Farm Bill must provide our 
producers with the risk management tools required to farm and 
ranch in this new reality. The current safety net is frayed and 
is in dire need of meaningful reinforcement.
    When I meet with farmers across Arkansas, when I meet with 
farmers across the country, they share their hopes and fears 
with me. The hope is that their children will one day take over 
the family farm. The fear is, of course, that this will not 
happen, through no fault of their own. Our producers are one 
trade war, one natural disaster or market downturn, or 
geopolitical conflict away from having to sell the farm.
    I think I would characterize the farm community now as very 
uncertain, which is really a bad place to be. A newly 
reinforced safety net is essential if the United States would 
like our farmers and ranchers to continue to produce the most 
abundant, most affordable, and safest food supply in the world. 
Climate change and nutrition programs have seen dramatic 
increases in funding while farm safety net resources have 
dwindled. In 2021, USDA increased SNAP by a quarter of a 
trillion dollars, using a flawed process, as GAO recently 
reported. This last year, the reconciliation process added $37 
billion in funding to USDA conservation, forestry, and rural 
development programs. However, neither the Administration nor 
the reconciliation process have done anything to bolster the 
safety net.
    The risk in farming has never been greater. Farm production 
costs are estimated to be $460 billion this year, a record that 
tops last year's record. Crop prices are likely to decline in 
the coming years, but prices for many of our major commodities 
would have to drop sharply before the current Title I Price 
Loss Coverage safety net would start to work. Corn prices, for 
example, would have to decline by 46 percent before farmers 
would receive assistance. By the time corn prices fell that 
low, the significant damage would have already been done.
    Farm bill programs, collectively, result in public benefits 
across the rural and urban landscapes, and we owe it to all 
Americans to ensure the bottom does not fall out of 
agriculture. We cannot only focus on certain programs and 
ignore others when all farm bill programs are necessary to 
achieve economic sustainability for our farmers and ranchers in 
rural communities.
    The farm safety net can work for all producers, large or 
small, organic or conventional, farms established a century ago 
or those just starting out. The important thing is that we 
all--producers, consumers, Congress, and the Administration--
stand together in support of a strong and resilient safety net. 
The next farm bill must work for those that feed, fuel, and 
clothe us.
    I hope today's hearing will bring these issues to light. I 
hope producers will hear the assurances they deserve, that the 
Administration and Congress understand the need to strengthen 
the farm safety net. I know that if we listen to our farmers 
and ranchers we will find a way to provide the right tools to 
manage risk, now and in the future.
    Again, I thank you all for being here, and we do appreciate 
your hard work. With that, Madam Chair, I yield back.
    Chairwoman Stabenow. Thank you so much. We have got a lot 
of important work to do, but we will weave our way through this 
to make sure we have that strong safety net that we need for 
all of our growers.
    I want to welcome again Under Secretary Bonnie, we have the 
other two, your sidekicks with you today, that we will 
introduce. I understand you will be giving testimony but they 
will answer the hard questions. Is that the way it is going to 
be? But seriously, welcome to all of you.
    Mr. Robert Bonnie is the Under Secretary for Farm 
Production and Conservation, no stranger to this Committee. He 
worked with the Bipartisan Policy Center's Farm and Forest 
Carbon Solutions Initiatives and the Nicholas Institute for 
Environmental Policy Solutions at Duke University. He also 
served as Under Secretary for Natural Resources and Environment 
and as a senior advisor to Secretary Vilsack in the Obama 
Administration. Welcome.
    Let me also introduce Ms. Marcia Bunger, who is the 
Administrator for the Risk Management Agency. She is the owner-
operator of her family's farm in South Dakota, with over 25 
years of experience working for USDA and the Farm Service 
Agency. It is also my pleasure to acknowledge that she is the 
first member of the Asian American Pacific Islander community 
and the first woman to serve as our RMA administrator, and we 
are so pleased to have you with us and to have your leadership.
    Mr. Zach Ducheneaux is the Administrator for the Farm 
Service Agency. His family operates a fourth-generation ranch 
on the Cheyenne River Sioux Reservation, and prior to this role 
he served as the Executive Director of the Intertribal 
Agriculture Council, he works since the 1990's. Zach has spent 
his career educating people about the importance of building 
new markets for producers and improving food systems, and we 
are very appreciative of your leadership and being here with us 
today.
    Under Secretary Bonnie, you are recognized for five minutes 
of testimony, and we welcome you again.

   STATEMENT OF HON. ROBERT BONNIE, UNDER SECRETARY FOR FARM 
 PRODUCTION AND CONSERVATION, U.S. DEPARTMENT OF AGRICULTURE, 
                        WASHINGTON, D.C.

ACCOMPANIED BY MARCIA BUNGER, ADMINISTRATOR, RISK MANAGEMENT AGENCY, 
            U.S. DEPARTMENT OF AGRICULTURE, WASHINGTON, D.C.; AND ZACH 
            DUCHENEAUX, ADMINISTRATOR, FARM SERVICE AGENCY, U.S. 
            DEPARTMENT OF AGRICULTURE, WASHINGTON, D.C.
    Mr. Bonnie. Thank you, Chair. I will make one, perhaps, 
correction, which is these are not sidekicks. This is the brain 
trust here, and I can use all the brain power I can get.
    Chair, Ranking Member Boozman, and members of the 
Committee, thank you for the opportunity to appear before you 
today as you begin consideration of a new farm bill.
    Through my decade of service to USDA and now seeing impacts 
from the pandemic and more frequent and intense natural 
disasters I have gained a much deeper understanding of the 
challenges our producers face and the ways our safety net 
programs are instrumental in keeping families on the land and 
helping them build more resilient operations. At FPAC I have 
the honor to work with USDA's producer-facing agencies as we 
partner with farmers, ranchers, and forest owners to strengthen 
American agriculture and forestry. All four FPAC agencies--FSA, 
RMA, NRCS, and the FPAC Business Center--are engaging producers 
in new and more effective ways, streamlining program delivery, 
opening the doors of agriculture to all, and providing a more 
effective and holistic farm safety net.
    Since 2021, this Administration has delivered pandemic 
assistance through CFAP and other programs in a way that 
provides invaluable assistance to producers while expanding the 
number of customers able to access aid. This approach through 
CFAP and our other programs has meant we are reaching an 
estimated 50,000 more customers per year as compared to pre-
pandemic levels.
    To expedite the distribution of the $10 billion in 
emergency relief funds provided by Congress in 2021, FSA and 
RMA leveraged existing data to streamline the application 
process and get money to producers faster than previous ad hoc 
programs. By year's end, FSA had processed more than 350,000 
applications totaling over $8 billion in payments to livestock, 
commodity, and specialty crop producers, to help offset 
eligible losses from 2020 and 2021. We estimate that the design 
of the Emergency Relief Program and the Emergency Livestock 
Relief Program saved over one million hours of staff time and 
equally significant time for producers as well.
    The 2023 omnibus provided direction to FPAC to assist rice 
producers impacted by high input costs. FSA and RMA are working 
to build on our experience from the emergency relief we 
provided in 2022 to create a process that will be easy for 
producers and our staff. The omnibus also provided funds for 
broader ad hoc disaster payments. While we were thankful for 
what Congress has provided, the funding provided will not allow 
us to provide a comparable level of relief for producers with 
2022 losses as compared to those impacted by 2021 and 2020 
losses.
    Even with these ad hob programs, I want to also reiterate 
that crop insurance remains a critical, a vital risk management 
tool for our producers. RMA is expanding coverage to more crops 
and producers than ever before. RMA's whole-farm and microfarm 
policies are providing new opportunities for diversified 
producers and small-scale operators. For the livestock sector, 
the Pasture, Rangeland, and Forage Program now covers more than 
250 million acres.
    USDA has also taken significant steps to support producers 
who rely on our farm loans. Thanks to passage of the Inflation 
Reduction Act, FSA was able to provide once-in-a-generation 
assistance to keep many of our borrowers in business. 
Approximately 11,000 delinquent direct and guaranteed borrowers 
had their accounts brought current with USDA's announcement in 
October. USDA also paid the next scheduled annual installment 
for qualified direct loan borrowers, giving them peace of mind 
in the near term while Administrator Ducheneaux and the FSA 
team consider other options to fully leverage the remaining 
assistance made available by Congress.
    The IRA also makes historic investment in farm bill 
conservation programs to support producers implementing 
climate-smart agricultural practices. In addition, Secretary 
Vilsack recently announced a substantial investment to support 
the adoption of climate-smart practices by farmers, ranchers, 
and forest owners through the Partnerships for Climate-Smart 
Commodities program. The effort will finance the production of 
climate-smart commodities through partner-led pilot and 
demonstration projects that help expand and create markets for 
these commodities. In all these efforts, USDA remains committed 
to a voluntary, incentive-based, and collaborative approach to 
conservation and climate change.
    Ultimately, none of our work is possible without a strong 
and well-trained work force. FSA Field Operations has 
prioritized hiring staff in county offices while taking steps 
to address recruitment and retention. More than 22,000 FPAC 
employees continue to deliver the 2018 Farm Bill programs that 
keep our agricultural producers in business and help them build 
stronger operations each year.
    I look forward to continued collaboration with the 
Committee as we seek to provide more efficient, effective, and 
inclusive support to the farmers, ranchers, and producers we 
serve. Thank you.

    [The prepared joint statement of Mr. Bonnie, Ms. Bunger, 
and Mr. Ducheneaux can be found on page 38 in the appendix.]

    Chairwoman Stabenow. Thank you very much.
    First let me say that I really appreciate the work you have 
done to improve crop insurance. I could not agree more that 
this is a fundamental tool, a critical tool, and I appreciate 
all the work that has been done to be able to make it more 
accessible. I really appreciate programs like NAP, making them 
more accessible to producers to help manage the risks of their 
operations.
    Could you talk a little bit more about the steps you have 
taken to make these programs accessible and what your 
recommendations are for building on them in the next farm bill?
    Mr. Bonnie. I will start and then I might turn to my 
colleague, Administrator Bunger.
    In all our programs we are always trying to make them work 
better for producers, and in the case of crop insurance it is 
through looking for ways to provide new products through our 
508(h) process. It is looking for ways to expand opportunities 
like whole-farm and microfarm that provide opportunities for 
specialty crop producers and others.
    With everything we are doing we are trying to open up the 
doors to make our, whether it is crop insurance or other safety 
net programs, available to as many types of producers to 
recognize the diversity of agriculture as we can. We think that 
remains important. Even with our ad hoc disaster programs we 
structure them in a way to encourage folks to take advantage 
of, whether it is NAP or crop insurance. We think, again, crop 
insurance is absolutely vital, but let me turn to Administrator 
Bunger.
    Ms. Bunger. Thank you, Under Secretary. Thank you, Senator, 
for the question. As a daughter of a fourth-generation farmer 
and now being the fifth generation on the same land, my husband 
and I have been farming together for the last 40 years. The 
last 27 years, crop insurance has been a cornerstone of our 
operation. Today, 27 years later, his corn and bean policy is 
the best in the world.
    It is my personal commitment that we also elevate specialty 
crop growers, we also elevate our urban egg producers, along 
with organic farmers, that they too have the same type of 
policy that my husband and I have had for the last 27 years.
    What we have done at RMA is to, in the last year, host 
numerous stakeholder meetings. We have hosted what we call the 
RMA Road Show, where we have gone out both in virtual presence 
and in in-person presence, and hosted a number of training, 
educational opportunities for the whole-farm program, and also 
for microfarm. In the last year we have taken the steps to 
reduce red tape with the paperwork with whole-farm and 
microfarm. We have doubled the amount of revenue limits on 
whole-farm. We have tripled that for microfarm so that now even 
more small, beginning farmers have the opportunity to use that 
microfarm policy.
    In addition, we have partnered with the climate partner and 
we have introduced what we refer to as TOGA--you know, we just 
love acronyms at USDA--the Transition Organic Growers 
Assistance program, where we are providing incentives to 
organic growers as they transition to organics but also to 
those that are currently in organics, growing feed grains.
    It is a passion of mine that all of these growers, whether 
they are beginning farmers, whether they are veterans, that 
they too have the same kind of policy that my husband and I 
have used for the last several years. Thank you.
    Chairwoman Stabenow. Well, I appreciate that very much, and 
it is different. When we say specialty crop growers, for 
instance, there is not one policy, is there, a policy for 
cherries or a policy for blueberries. Whatever it is, it is all 
different. It is complicated. We know that large and small, 
just like a small business versus large business, small farm 
versus large farm, paperwork is even a bigger issue for small 
enterprises. I hear this all the time, and it is an area I 
would love to see us doing even more on to streamline what is 
happening around the paperwork issues for our small 
enterprises.
    Mr. Bonnie, let me ask you. There is a new crop insurance 
product that you announced, an innovative farm-led new crop 
insurance product known as PACE. I want to thank the corn 
growers and whole group of farmers that really have come up 
with this. It is to help farmers manage risks, save money by 
reducing their fertilizer use and improve water quality. It is 
available in some counties in Michigan, in other States it was 
available last year, in 2022, but there are going to be more 
coming on board. We have not yet seen any more added in 
Michigan. There is a lot of interest as well as in other 
States.
    Can you talk about the challenges in expanding new products 
like PACE and how the farm bill can improve the rollout process 
for products so that farmers have more of these innovative 
tools that they are actually coming up with themselves?
    Mr. Bonnie. Yes, as you point out this product really came 
through our 508(h) process from commodity groups and others.
    One of the issues is making sure the agents on the field--
crop insurance is a public-private partnership, and we need to 
make sure our agents have the tools they need to be able to 
sell these products. There is always a learning curve with new 
products like this. This is an innovation that we hope will 
work. It gives opportunities for producers to try new things, 
to think about ways that they can improve their stewardship. As 
we roll it out, and both farmers and agents get more familiar 
with it, our hope is that folks will find utility in this 
approach.
    Chairwoman Stabenow. Thank you very much. I will turn to 
Senator Boozman.
    Senator Boozman. Thank you, Madam Chair.
    Secretary Bonnie, over the last six years, USDA and 
Congress have provided more than $70 billion in ad hoc disaster 
assistance to farmers, while at the same time Title I farm bill 
programs have delivered less than $3 billion per year. Congress 
has stepped up, but as you know that is a difficult process. 
The delay in the ad hoc support resulted in assistance arriving 
years after the disaster occurred. The reality suggests the 
existing safety nets need to be enhanced and that we must find 
a better way to more quickly deliver relief to producers.
    I guess really what I would like for you all is to discuss 
that and tell us how we can do a better job to reduce ad hoc 
needs. How can we use the farm bill, or can we commit 
additional financial resources to improve the safety net, or 
develop new risk management tools? What are you thinking along 
those lines-because it is a huge problem. I think you are going 
to hear a lot about that today, and certainly it is something 
that farm community is very concerned about.
    Mr. Bonnie. I think the point that both you and the Chair 
have made on the importance of reducing paperwork, rolling 
things out more quickly is really, really important. In the 
case of the Emergency Relief Program we tried to use existing 
data, prefilled forms, and other things to both reduce the work 
load, frankly, in our field offices, but reduce the work load 
on producers. We think there is a lot to learn there to move 
resources more quickly, and we think that will allow us, as we 
move forward. I mentioned in my opening comments about the rice 
assistance, that we think we can take some lessons there to 
move more quickly.
    Again, we think crop insurance is critically important. We 
think NAP, there are significant opportunities there, areas for 
us to improve NAP to make it easier for producers to get in. As 
you point out, there is growing interest, and has been 
resources for these ad hoc programs, and I think our job, on 
the implementation side, is to get those out as efficiently and 
quickly as we can to help our producers, and to look for ways 
that we can enhance our tools, whether it is crop insurance, 
some of the programs Administrator Ducheneaux works on, to 
expand them in ways that are most responsive to producers' 
needs.
    Senator Boozman. Yes, again, if we could come up with some 
ideas. We are spending the money anyway. Seventy billion 
dollars is a huge amount of money, and we can be proud that we 
are doing that, and compared to the $3 billion-less than $3 
billion-that are in your actual programs. How do we maybe 
capture some of that $70 billion, put it into programs that 
people can rely on and use responsibly in order to make things 
work better?
    It is a big problem and it is something that we are all 
going to need to work on together. If we could somehow make 
that work on better it would be a huge improvement.
    The Federal Crop Insurance Program has been successful in 
providing certainty for producers and their lenders in 
mitigating a variety of risks. It also offers flexibility for 
farmers to select which coverage options are best for their 
operation. What I get concerned about are efforts to use the 
Crop Insurance Program as a carrot or a payment delivery tool 
to try and get producers to adopt specific climate and 
conservation practices without regard to what is best for their 
individual operations, the crop being grown or whether the 
practice is effective in a particular region.
    Can you commit to making sure that any efforts to expand 
the Crop Insurance Programs are science-based, peer-reviewed, 
and protect the integrity of the program? Really what that gets 
to is kind of a one-size-fits-all. Cover crops do not work 
every place. It might be spending those dollars on education--
and again, I am just thinking out loud now, but using those 
dollars on educational tools to help whatever those producers' 
needs are to do a better job, from a climate standpoint, a soil 
standpoint, or whatever.
    I think right now we are kind of a one-size-fits-all and we 
do not like going down that path.
    Mr. Bonnie. I think your point about one-size-fits-all is 
really important. Whether it is conservation or climate-smart 
ag, it is going to look different to different producers. Our 
job is to provide a toolbox, and I think with respect to crop 
insurance, everything we have to do has to be actuarily sound. 
We have got to maintain the integrity of crop insurance. That 
is critically important.
    As you know, we have provided some incentives for cover 
crops, using a rebate there that does not affect the actuarial 
soundness of the program but provides an option for producers. 
I think as we think about climate, productivity in and of 
itself is important. We have got to keep producers producing. 
They have got to be economically viable. Anything we do, 
whether it is in crop insurance and elsewhere, has to recognize 
that that is critical.
    Again, I think your point about the need for flexible tools 
is critical.
    Senator Boozman. Thank you, Madam Chair.
    Chairwoman Stabenow. Thank you very much. Senator 
Tuberville.
    Senator Tuberville. Thank you, Madam Chair. Thanks for 
being here today. The topic we are discussing today is very, 
very important for my folks back in Alabama. The farm bill 
process, you know, my goal is to assure that Alabamians and the 
Southern States have a seat at the discussion table. Our 
farmers rely upon a strong farm safety net to manage risks, 
weather, natural disasters, remain in business despite 
fluctuating market conditions. Despite the USDA's farm safety 
net, producers are still struggling to breakeven due to 
skyrocketing inflation and rising input costs for food, fuel, 
and fertilizer.
    As farm bill discussions take place, we want to ensure a 
strong crop insurance program that maintains the public-private 
partnership makeup to help our producers manage risk. Over 1.5 
million acres, equaling $920 million, are protected by crop 
insurance in my State of Alabama.
    Additionally, Alabama producers rely heavily on the Price 
Loss Coverage and the Agriculture Risk Coverage programs to 
help them stay on their feet when crop revenues decline or 
market values are low.
    Mr. Bonnie, my peanut growers in Alabama report that PLC in 
the 2018 Farm Bill has worked well. From a safety net 
perspective, references prices have not kept up with the rising 
input costs in agriculture. Has USDA reviewed how we address 
inflation from a policy perspective over the life of the farm 
bill?
    Mr. Bonnie. I will tell you my legislative staff is always 
quick to tell me to emphasize that Congress writes the farm 
bill, and that is going to be important here too. Obviously 
those reference prices are in statute.
    I think you are right. When we talk to producers there is 
lots of concern about obviously rising input costs. Our 
delivery of our programs is critical to be able to put money in 
their pocket to help address that, and I assume the 
conversation about those prices will be a part of the debate 
that Congress has.
    Senator Tuberville. During the Trump administration, when 
commodities were impacted by foreign trade barriers and 
retaliatory tariffs, USDA implemented the Market Facilitation 
Program to help offset export losses growers were facing. Has 
the USDA considered a similar program to offset the rising cost 
of farm inputs?
    Mr. Bonnie. We have not, but I think as you know we have 
made some investments to try and encourage, for example, 
domestic production of fertilizer to create more options, more 
competition, and we think that that approach and potentially 
other approaches might be helpful on input costs.
    Senator Tuberville. Thank you. Mr. Bonnie, one of the 
strong suits of the Federal crop insurance program is RMA's 
authority to do its own research and develop policies. Through 
this approach, the program can expand to cover new crop types 
such as specialty crops and managing new types of risk.
    When I looked through the RMA summary of business for 
Alabama I see dozens of available crop insurance products where 
we are selling fewer than 10 policies each year, 10 policies 
among Alabama's 44,000 farmers. I like having options for our 
farmers and support the flexibility of the program, but from a 
good governance perspective, can you walk me through any cost 
benefit analysis you do on the marketability of the policies 
you put out, and do you need additional authorities or 
resources to do that kind of analysis?
    Mr. Bonnie. I might turn that question to Administrator 
Bunger.
    Ms. Bunger. Thank you for the question, Senator. Currently 
how RMA stands up, all of it is different crop policies. I call 
it a three-pronged approach. We look to the Hill and we look to 
you to have us stand up those policies that you write. We also 
look to the 508(h) process where private submitters submit, and 
they also involve then recommendations, support from growers, 
much like the corn growers did with PACE. Then the third is 
within the department itself, within what guidelines that RMA 
has to stand up programs. All of those come with reviewers and 
actuarial soundness that needs to be maintained. It is a 
balance. With the 508(h) process they are supported by 
reviewers and also AIPs that recommend how marketable the 
products are. We will continue to work through those and take a 
look at those.
    The policies that are available have increased 
exponentially. In 2000, I believe, RMA had 300 policies, and 
now today we are at 600 policies. The billions of dollars of 
liability that are covered under those policies have grown also 
dramatically. The dollar amount that comes to my mind, back in 
2000, was $30 billion. Today we are at over $200 billion worth 
of liability, and that is every year.
    We are seeing a great deal of interest in all of the 
policies that we stand up, but at the end of the day we listen 
to the farmer. We listen to the stakeholders and what their 
needs are, and that is what we will continue to do.
    Senator Tuberville. Thank you. One quick question, Mr. 
Ducheneaux. I hear concerns from Alabama farmers that FSA loan 
size limitations have not kept up with rising prices of farm 
land and farm inputs, making it more difficult for farmers, 
especially beginning farmers, to access capital. Do you think 
we should increase those loan size limits, and if so, what 
level do you believe that we should go to?
    Mr. Ducheneaux. As the Under Secretary mentioned, sir--
thank you for the question, but as the Under Secretary 
mentioned we understand our role in this, and our role is to 
carry that out, whatever statutory limits the Congress would 
put on us with regard to those loan programs. I hear the same 
concerns from a lot of the producers that I have a chance to 
talk with. I give my phone number out at every event, and I 
encourage producers to call. We make sure we share with them 
where the problems are that we cannot overcome with regulatory 
or policy work, and that is one of them that we just run into 
about every time.
    Our lenders enjoy a $2.037 million guarantee, and we have 
the capacity, in many cases, to be more flexible than lenders 
can because of our broader risk pool. We cannot help borrowers 
that get in trouble with a guaranteed lender. There is really 
only one way out.
    I would really love to visit further about what those 
limitations may be and look forward to getting requests from 
you all about how we can provide technical assistance.
    Senator Tuberville. Thank you, Madam Chair. I have got a 
couple of questions I would like to submit for the record, 
please.
    Chairwoman Stabenow. Thank you very much. I just want to 
followup and encourage you. We would love to have further input 
from you both. Senator Boozman and I were just saying we hear 
about this, so we would welcome, as part of this process, is to 
get as much input and ideas as possible. We would welcome 
further discussion.
    Senator Hyde-Smith.
    Senator Hyde-Smith. Thank you, Madam Chair and Ranking 
Member Boozman, for having this hearing today, and thank you 
guys for being here. It is really critical and it certainly is 
in my State.
    Mr. Under Secretary, I would like to discuss the disaster 
assistance programs authorized under the farm bill, 
specifically the Emergency Assistance for Livestock, Honey 
Bees, and Farm-Raised Fish programs, (ELAP). Mississippi grows 
more catfish than any other State in the Nation, and it has 
been such a good crop for our State, for many years, and we 
certainly want to protect it and do everything we can to 
enhance it, because on Friday nights, southerners go eat 
catfish at a catfish house somewhere. I am guilty. We do it on 
Friday night as well.
    The bird depredation and the disease is really posing a 
great threat to the long-term viability. It amazes me what a 
nuisance and just a disaster they can be. The catfish producers 
suffer substantial economic losses to the bird depredation 
annually. The problem is really three-fold. Obviously the 
revenue that is lost by the fish that are consumed by these 
birds, and it is amazing. I do not know if you have ever 
watched them. It is amazing to watch this happen. Then there's 
death losses due to the diseases introduced by fish-eating 
birds. Then, of course, the increased cost that it takes to 
scare the birds away from the ponds.
    Since the vast majority of the catfish production occurs 
just in a few States--Alabama, Arkansas, and Mississippi--we 
really do not get a lot of attention on this because it is kind 
of just a Southern State thing. Let me just describe to you 
what these farmers are dealing with. I mean, hundreds of 
thousands of these cormorants migrate south each winter, and we 
just look for them. We know it is coming.
    They are fish-eating birds and they can eat one to three 
pounds of fish per day, per bird. Because catfish ponds, which 
are relatively small, 10 to 20 acres, are stocked with about 
7,000 pounds or more of fish per acre, they make a very 
attractive stopping spot for these birds. They know exactly 
where they are coming. I mean, it can be a flock of 500 easy, 
at one pond, and that is not uncommon, and they can be there 
for weeks. They can be there for months. We all know when they 
are there because that is when the phone starts ringing.
    During these events a farmer may spend $800 or more per 
acre to scare the birds away. Since the cormorants and other 
predatory birds, such as pelicans and cranes, are federally 
protected under the Migratory Bird Treaty Act, we cannot use 
lethal methods without a permit from the U.S. Fish and Wildlife 
Service, and those are pretty difficult to get for these 
farmers.
    Rarely does a flock leave for very long and they are right 
back after you scare them off. That is a lot of shells. After 
the cormorants leave the catfish farm in the spring to fly 
north, farmers are often counting thousands of fish that died, 
just from the diseases they brought with them, on top of the 
fish that they consume. If you do the math a large flock of 
cormorants eating one to three pounds of fish per day for a 
month, is a huge financial hit to these guys and ladies. When 
you factor in disease and the other additional costs, it has 
put people out of business.
    Unfortunately catfish producers are not eligible for any of 
these losses under ELAP, or any other USDA disaster program, 
for that matter. They just have to take the losses. This is a 
genuine crop loss here that is out of their control. I would 
certainly consider losing $1 million worth of fish in a short 
amount of time, or spending tens of thousands of dollars to 
scare birds--I mean, obviously, it is a disaster to these 
farmers.
    The U.S. farm-raised catfish industry is a major 
contributor to rural economies in the Southeast and provides 
thousands of jobs in some of the most rural and underserved 
parts of this entire country.
    Saying all of that, I would love to amend ELAP in the 2023 
Farm Bill to address the issue. I guess my question, Mr. 
Secretary, is would you commit to working with me and my staff 
and the Senate Ag Committee to provide technical assistance and 
feedback on several proposals that we are looking at related to 
this issue that I am working on? I want to be sure that any 
changes made to ELAP work and are easily implemented by USDA. 
We have a really major problem with this, and it is, you know, 
it is a southern thing but I just want your commitment, if you 
can give that to me, to help me with these issues.
    Mr. Bonnie. Absolutely. I might turn to Zach as well. I 
know he has been engaged on this issue as well. We will 
absolutely commit to work with you. Let me turn it to Zach.
    Mr. Ducheneaux. Thank you, Senator, for the question, and 
growing up on a ranch, driving an H tractor in a hayfield with 
a jumbled-up toolbox and a messy garage that we did not have 
the money to put the electricity in, I learned how to use tools 
very well and learned how to improvise.
    ELAP is our best tool for that flexibility, and we were 
able to use that tool to extend some flexibility to the 
aquaculture industry broader. The causes of loss that you 
mention, we do have some challenges with those particular 
causes of loss under the program. Absolutely, we would love to 
work with your staff to help get to some solutions that work 
better for your producers.
    Senator Hyde-Smith. Can you just briefly tell me some of 
the challenges of why we do not meet that?
    Mr. Ducheneaux. ELAP has a lot of weather-related cause of 
losses. We were able to find flexibility to get aquaculture in 
under the weather-related damage with regard to Winter Storm 
Uri in 2021. To hear the redfish producers tell it, we really 
helped save their industry.
    The barrier or the bar against assisting where it is a 
depredation issue, we use our LIP program for depredation 
issues. There is maybe a little bit of a confluence of 
programming that needs to happen there in order for us to 
really meet that need.
    Senator Hyde-Smith. Okay. Well, thank you so much. I am 
glad you guys understand and that you are familiar with this, 
and I appreciate your help. Thank you, Madam Chair.
    Mr. Ducheneaux. Yes, ma'am.
    Chairwoman Stabenow. Thank you very much. Senator Boozman.
    Senator Boozman. Madam Chair, again I want to echo. The 
problem that is interesting, the Chairwoman and I were 
visiting. They have a similar problem with brown trout up 
north, and have gone around things a little bit different.
    Really, if we could sit down with you all and APHIS and 
then Fish and Wildlife. There is all a component for all of us, 
and really just kind of talk through that and see how we can do 
a better job adhering to the things we need to. I think we can, 
and it is just going to take some cooperation from everybody. 
This really is a huge problem. Thank you.
    Chairwoman Stabenow. Thank you very much. I was sharing 
with Senator Boozman that we have a brown trout festival in 
Michigan, up around Alpena, and 1 year they had to cancel it 
because there were no brown trout because the cormorants had 
attacked and killed all the trout. There have been some 
strategies that have actually worked, related to this, but it 
has been an ongoing issue. I appreciate the discussion.
    Mr. Bonnie. We welcome the conversation, good relationship 
with the Fish and Wildlife Service, and happy to engage there 
as well, and obviously APHIS as well.
    Chairwoman Stabenow. Thank you. Well, Senator Thune just 
came back in. I was about to call Senator Ernst, but Senator 
Thune, you bumped her.
    Senator Thune. I am so sorry.
    Chairwoman Stabenow. Okay. Senator Thune, on our list, is 
next. Then Senator Fischer. Then Senator Ernst. Senator Ernst, 
you should have tripped him on the way in and I would have been 
able to get to you.
    [Laughter.]
    Chairwoman Stabenow. Senator Thune.
    Senator Thune. Thank you, Madam Chair and Ranking Member 
Boozman, for holding today's hearing on these very important 
titles in the farm bill, and I also want to thank our USDA 
witnesses for appearing before the Committee, and it is nice to 
have fellow South Dakotans here, Administrator Bunger and 
Administrator Ducheneaux with us today. It is critically 
important that the next farm bill provides a strong safety net 
and risk management tools that allow farmers and ranchers to 
continue working to feed and fuel our Nation and the world. 
Crop insurance and commodity programs must be maintained, and 
where possible, improved in the next farm bill to help 
producers face challenges from high inflation and input costs 
to adverse weather events.
    Before I turn to my questions I want to raise concerns with 
USDA's Emergency Relief Program, the ERP Phase Two. I 
appreciate USDA's efforts through Phase One ERP, which 
generally worked well in supporting producers with crop losses 
in 2020 and 2021, but the Phase Two methodology, if comparing 
Schedule F or taxable income from benchmark periods in 
disasters years often does not accurately reflect crop losses 
that Congress meant to cover. I want to urge USDA to consider 
its ERP Phase Two methodology and to use the Phase One approach 
going forward for 2022 crop losses.
    Under Secretary Bonnie, as you know agriculture risk 
coverage and price loss coverage are important safety net tools 
for producers. I secured a provision in the 2023 Farm Bill that 
allows producers to annually elect and enroll in ARC for PLC 
starting in 2021 and again in 2022 and 2023, and I appreciate 
USDA's efforts to coordinate this FSA deadline with RMA's March 
15th deadline to apply for crop insurance for crops.
    As we work to build off successes of the 2018 Farm Bill, 
like the annual election, what else can be done to maximize 
producers' options and access to decisionmaking tools, and what 
ideas do you have to better streamline administration of 
programs across the agencies that you oversee?
    Mr. Bonnie. On the ARC PLC front let me turn to 
Administrator Ducheneaux.
    I would just say, more broadly, there was a conversation 
while you were out of the room about ad hoc and the ad hoc 
disaster in crop insurance, and we are committed to crop 
insurance. We know how important it is in your neck of the 
woods but it is important across the country. We think creating 
incentives for producers to take advantage of crop insurance, 
same thing on the NAP side, the more we can do to get them into 
those regular safety net programs we think that is critically 
important. We want to continue to encourage that.
    Let me turn to Zach on the ARC PLC front.
    Mr. Ducheneaux. Thank you, Senator. It is good to see you. 
Good to be around South Dakotans as well.
    With regard to ARC/PLC and the annual election we hear that 
producers like that. One of the challenges that we hear 
producers express all across the country, as we get a chance to 
go out and visit in the countryside, is reference prices, as 
Senator Boozman mentioned, need to be adjusted in order to make 
that a better tool for them, and we welcome conversations with 
our colleagues on the Hill about how do we make thoughtful 
decisions about that, to the point Senator Boozman made as well 
about a better allocation of that funding that is going to ad 
hoc programs as well.
    Another conversation that comes up as we dive into our 
communities that are maybe more underserved and have not had 
the benefit of these programs for decades and generations is 
the allocation of base acres and the fact that in many of these 
communities where they are trying every bit as hard to farm, 
base acres do not exist. We do not have a base acre concept in 
grazing land, for instance, in western South Dakota.
    Those are some things that we have heard from our 
producers, and we welcome conversations with you all about how 
can we make adjustments to make it fit better.
    Senator Thune. Thank you. Let me just--and I am going to 
direct this to all of you--Senator Lujan and I are working to 
introduce our proposal to improve the effectiveness and 
timeliness of disaster programs for livestock producers. USDA's 
technical assistance is vital as we work to refine and improve 
programs in the next farm bill.
    Will you make it a priority for USDA to provide technical 
assistance in a timely manner?
    Mr. Bonnie. Absolutely.
    Senator Thune. Thank you. Our proposal also seeks to 
improve the accuracy of the drought monitor, which triggers 
certain disaster programs. I am going to ask, I guess, any of 
you what ideas you have to strengthen disaster programs and the 
drought monitor in the next farm bill. If you could comment on 
that it would be great. Thank you.
    Mr. Bonnie. Yes, I am absolutely willing to work with you 
on that, and I want to return to the disaster question here. We 
are increasingly facing pretty intense disasters, whether it is 
hurricane in Florida, Puerto Rico, wildfire in New Mexico, that 
I know Senator Lujan has been engaged with, and we are 
essentially having to build jump teams within FSA to be able to 
surge staff to those areas. The same thing on the NRCS side 
because there are some emergency authorities there.
    We are building, essentially, the ability to almost put 
together incident management teams to be able to deal with 
those disasters. I want to bring it to your attention because 
it is increasingly taking resources of USDA, and it is an 
important issue. We do a good job, for example, in wildfire on 
disaster response, but we are going to need to standardize how 
we do disaster recovery as well, and we are spending more time 
on it. It is increasingly a critical issue and I think one that 
I want to make sure you all are thinking about as well.
    Senator Thune. Thank you. My time has expired, Madam Chair. 
I have got some additional questions and I will submit them for 
the record. Thanks.
    Chairwoman Stabenow. Thank you very much. Senator Fischer.
    Senator Fischer. Thank you, Madam Chair. As many have 
already said today it should be a top priority of this Congress 
to protect crop insurance. Crop insurance is the quickest and 
most efficient way to provide aid to our farmers and ranchers 
after a disaster. Farmers recognize this and they often value 
the relationship they have with their crop insurance agents. In 
fact, we have heard from some crop insurance agents that 
farmers are sometimes even being directed by Farm Service 
agency local offices to reach out to their crop insurance 
agents to answer questions about disaster programs.
    So Under Secretary Bonnie, as we all know FSA and RMA are 
different agencies. Given that farmers are being directed to 
reach out to their crop insurance agents, sometimes by FSA, the 
staff themselves, how can USDA ensure that crop insurance 
companies and the agents have the proper information so that 
they can answer questions about those FSA programs?
    Mr. Bonnie. I am going to turn to both of my colleagues 
here. One thing, I think, we are working to do a better job of 
is making sure our field offices understand our programs as we 
roll them out. Training is really, really important, 
communication with our field offices, so that they can provide 
answers.
    Let me turn to first Zach and then Marcia.
    Mr. Ducheneaux. Thank you. Thank you, Senator Fischer. As 
the Under Secretary mentioned, we are really working at 
collaborating better, especially within our mission area, where 
we are all in the same realm of really helping the producer-
focused aspect of the USDA. That is another thing we hear from 
producers as we go around the country. ``You already have my 
information. Why do I have to submit it again?'' We think we 
have been able to address that with ERP Phase One.
    Now the question you asked about when the producers have 
challenges, getting referred to their insurance provider, there 
are some things that their insurance provider has that we do 
not, and when we need that information we want to make sure 
they are getting it from the source and not us guessing about 
what it might be. It is about coordination and about really 
maintaining that relationship that is so important between that 
producer and their insurance provider and trying not to get in 
the middle of that relationship and foul things up. It is about 
getting accurate information.
    Senator Fischer. Correct. Do you think there is a better 
way to be able to get that information to the agents about the 
programs that you have?
    Mr. Ducheneaux. One of the efforts that we have undertaken 
since we have been out doing stakeholder visits and listening 
to our staff and our producers is there is a lot of frustration 
when we make an announcement and the staff do not know what we 
have announced about. We have changed that and we are starting 
to read the staff in sooner, and we are looking to engage with 
our cooperators sooner. Within the FSA we have got a lot of 
cooperators out there representing young farmers, veteran 
farmers, underserved farmers. We are looking at reading them in 
at that same time, and it makes sense that we would do so with 
our approved insurance providers and their agents as well. I 
will ask Administrator Bunger to speak to their notification 
process with them.
    Senator Fischer. Thank you.
    Ms. Bunger. Thank you. Thank you for the concern and the 
comments. Being we are fellow South Dakotans, I have had the 
privilege and the honor to now work with Administrator 
Ducheneaux, and it has been fun. It has been a fun 
collaboration. I think we have really leaned into one another, 
and it was evident with Phase One and the huge success of Phase 
One. I think we saw the benefits of that leaning into each 
other, and that is just how I think we will approach it from 
RMA is that the model will be that, you know, we are going to 
communicate out messages. We are going to communicate out 
messages for each other. We are going to answer questions when 
we can, and if we cannot we are going to defer to each other.
    As a former crop insurance agent myself, I recognize the 
importance of being not only good at crop insurance but also 
being familiar with what was going on at FSA. That gave me 
maybe an advantage when I was out with my customers, but I, 
too, am going to leave with that message, that agents, please, 
please, please reach out to FSA, communicate back and forth, 
and we will continue to do it from the top to the bottom.
    Senator Fischer. Thank you. Thank you. Under Secretary 
Bonnie, Senator Klobuchar and I have introduced a bill with the 
precision agriculture, focusing on providing loans to small 
family farmers and ranchers so that they can become even better 
stewards of the land and take advantage of that new technology 
that is available, to be able to provide information to them to 
become even better conservationists. When we are looking toward 
the farm bill now, kind of to piggyback a little bit on what 
Senator Thune was talking about with technical assistance, I 
would hope that we could reach out to you to make sure, as we 
look to the farm bill and be able to look at that precision ag 
loan act that we have, to make sure we have just the exact 
wording that we are going to need to get that in there for our 
folks to be able to jump on that and take advantage of it.
    Mr. Bonnie. Absolutely. I really appreciate your interest 
in this. It is vital from a conservation and it is vital from a 
climate standpoint. We have got to maintain productivity, even 
while we think about conservation. I really appreciate your 
leadership, and I absolutely would love to work on this.
    Senator Fischer. Great. Thank you. Thank you, Madam Chair.
    Chairwoman Stabenow. Thank you very much. Senator Ernst, 
you have been bumped again. Senator Smith.
    Senator Smith. It is a complicated morning to get our 
timing right, is it not? Thank you very much, Madam Chair and 
Ranking Member, and thanks to our panelists. It is good to be 
with you.
    I would like to start by getting your assessment of what it 
is that we need to do to improve access to credit and other 
financial tools for farmers of color and beginning farmers. 
This is an important issue for so many reasons, not least 
because the average age of farmers is climbing and it is 
increasingly difficult for young farmers to get started.
    Minnesota has a very diverse farm economy--Hmong, Native, 
Latino farmers, Black farmers, all very active and productive--
and I often hear that USDA could be doing more to support them 
as they are getting started in building their businesses, 
acquiring equipment, and developing markets. Of course, they 
need access to credit and risk management tools, some of which 
they know nothing about.
    I would like to ask everyone on the panel, could you just 
talk a bit about what it is that we need to do differently and 
how can the farm bill help these farmers get improved access to 
credit and insurance programs so that they can operate?
    Mr. Bonnie. I am going to do the smart thing and talk very 
briefly and hand it over to this guy sitting on my left.
    Senator Smith. Thank you.
    Mr. Bonnie. Equity cuts through everything we do. We need 
to make sure we open the doors wide for everybody, and that 
will benefit all of agriculture, and obviously farm loans is a 
critical part of that. We think about it on the conservation 
side. We think about it in farm programs more broadly.
    Let me turn to the administrator.
    Mr. Ducheneaux. Thank you, Senator. I appreciate the 
question. This is what I feel like I was brought to the agency 
for is to help improve access to credit, especially to those 
underserved populations. It is what I have spent my life doing. 
The tools that we have oftentimes can work with the proper 
guidance. The challenge is there is a culture change that needs 
to happen, and we should look to be that lender first 
opportunity as opposed to that lender of last resort. I think 
that can start with a better reading of our authorizing 
statute--credit sufficient to meet the actual needs of the 
borrower at reasonable rates and terms.
    We do not do an analysis when we get producers in the door, 
one, because we had a stack of papers 29 pages tall, as you are 
well aware, just to get an application completed. We have 
refined that down to 13 now, as the first step in better 
serving equitably across all of the populations we serve. The 
next step in that is to really take a look at that 
authorization that we have and contemplate what that test for 
credit is, because in many cases our loan officers, they feel 
like they have no choice but to tell that producers, ``You can 
go get credit over there. It is going to cost you five percent 
more, but go get another job and then you can make that work.''
    We want to be able to have an analysis, talk about long-
range planning with that producer. The funding we have received 
in the Inflation Reduction Act, to think about loan 
modifications differently and fund those changes is critical to 
really opening that toolbox for our borrowers with respect to 
loan servicing and better loan structuring as a planning tool 
for our producers, because to the point made here earlier 
today, there is $70 billion in ad hoc disaster assistance that 
has been delivered in the last few years. There is over $350 
billion worth of farm income every single year for the last 10, 
and we have got to find ways to ensure that more of that 
circulates through the producer's balance sheet before it is 
taken out of that community.
    Senator Smith. Thank you for that, and I would like to 
continue this conversation and continue to work with you on 
this so that we can figure out what we need to do in this 
upcoming reauthorization to support the work that you are doing 
to expand access to these really important tools, which are 
going to make the different in whether somebody is able to stay 
in the sector, whether they are somebody who has been 
traditionally blocked out of this sector, or whether they are a 
new, beginning farmer that is just trying to figure out how to 
put the money together to start an operation.
    Mr. Bonnie. Ma'am, if I may----
    Senator Smith. Yes, please.
    Mr. Bonnie [continuing]. I would like to offer that 
properly structured credit is a risk management tool.
    Senator Smith. Absolutely.
    Mr. Bonnie. It lets that producer divert production income 
toward the needs, if it is not all taken right back out of the 
operation. I welcome the conversation.
    Senator Smith. All right. I just have a few seconds left, 
and I am eager to hear the questions from my good friend, 
Senator Ernst. In 2018, we created the Dairy Margin Coverage 
Program. Dairy producers have generally been happy with the 
program, at least in Minnesota. They agree that it has been an 
improvement, and also tell me that the work that we have done 
with the USDA to make sure that people know about it and 
understand the benefits, help people to sign up early, has been 
very useful.
    Could you just, Under Secretary Bonnie, could you just talk 
briefly about how you see this and what the approach is going 
to be of USDA to continue to do outreach and promotion on this 
important program?
    Mr. Bonnie. Vitally important program. It has been 
incredibly important for our dairy producers. We have worked to 
update the cost of feed so that it actually works better for 
producers, so looking for ways that we can make sure that the 
margins are more accurate or more reflective of what is going 
on down on the ground. We have provided supplemental coverage 
as well. Obviously, a very important part of the safety net, 
and I think we would welcome the opportunity to work with all 
of you on it.
    Senator Smith. Thank you. Thank you, Madam Chair.
    Chairwoman Stabenow. Thank you very much. While Senator 
Grassley has joined us I have asked him to allow his junior 
Senator to go first. Senator Ernst has been waiting a long time 
and bumped many times, and we appreciate Senator Grassley 
allowing Senator Ernst to proceed. Senator Ernst.
    Senator Ernst. Thank you. Thank you, Madam Chair and 
Ranking Member, and thanks to the witnesses for being here 
today.
    With the precision agriculture and innovative technologies 
that we see across the ag spectrum now I am always very 
impressed with the ways our farmers are continuously seeking to 
improve their productivity and to always, always be good 
stewards of their land. As a condition of receiving Title I and 
crop insurance benefits farmers are required to meet specific 
environmental standards such as protecting our water quality, 
very important in Iowa. They have to protect our wetlands and 
soil health. These are all important and should be maintained 
but not augmented.
    Crop insurance is the most effective and best risk 
management tool. You have heard it from everyone, I think, here 
today, so it tells you how important this is. It is that most 
important tool that farmers have, and it is critical that we 
maintain that safety net that is affordable as well. It is 
especially important as we consider the young and beginning and 
small farmers because the lenders look at that crop insurance 
as a way to guarantee operating loans. On average, our farm 
balance sheets, they have been strong with the recent high 
commodity prices, but as land, equipment, and other inputs 
remain high it is even more vital to have those risk management 
tools.
    I will not ask the question again because Senator Smith did 
a good job of covering it, but making sure that those young and 
beginning farmers have the support that they need, and 
Administrator, I know you had addressed that. Just something to 
keep in mind as we are working through the farm bill, just any 
additional thoughts that you have please reach out to us 
because I think all of us on this Committee are absolutely 
willing to work with you to make sure that we keep those 
supports in place.
    Another important issue that I have been working closely 
with the Chairwoman on, Chairwoman Stabenow, Ranking Member 
Boozman, and USDA staff is legislation to modernize the 
Agricultural Foreign Investment Disclosure Act. As you know, 
according to USDA's 2021 AFIDA report, foreign persons hold 
interest in approximately 40 million acres of U.S. ag land. 
That is more total acres than make up my entire home State of 
Iowa.
    Among a multitude of reasons, my concerns has been 
reinforced by the Chinese spy balloon last week and the 
Chinese-owned Fufeng Group's proposed corn mill near Grand 
Forks Air Force Base in North Dakota. Our national security is 
at risk, and I am very, very concerned about the increasing 
foreign ownership of our farmland.
    Administrator, I look forward to continuing to work with 
you and your team and the Committee to make meaningful updates 
to AFIDA and to provide the important resources needed to 
protect our farmland and ensure our national security. 
Administrator, could you share some of the challenges your 
staff have with the outdated process and the resources needed?
    Mr. Bonnie. Yes, ma'am, and thanks for the question. As we 
go around the countryside we hear concern not only about 
foreign ownership but absentee ownership in the areas that are 
transitioning from agriculture to some other use. It is 
critical that we manage that. We have had some of our producers 
actually tell us, ``You all should regulate that.'' I said, ``I 
don't think you want us regulating that.''
    Senator Ernst. Probably not.
    Mr. Bonnie. To the point about AFIDA, it is a paper-based 
process right now, and we are not a regulatory agency so we do 
not have a lot of enforcement tools against foreign owners for 
not coming in and doing that paperwork. We are going to need 
resources, if that is a job that we are going to be tasked 
with. We are good at picking it up and running with it, like 
the producers that we serve, when we get another job. If we can 
get the resources to do that properly and the cooperation 
across the Federal family we are ready to do it.
    Senator Ernst. Thank you. Administrator, just for everybody 
information, what year are we in this year?
    Mr. Bonnie. It is 2023.
    Senator Ernst. Exactly. You stated largely it is a paper-
driven process.
    Mr. Bonnie. I welcome conversations with you.
    Senator Ernst. Absolutely. I appreciate that. I think this 
is something that really needs to be worked on. Food security 
is national security, and we really need to make sure that we 
do have those resources dedicated to updating our system so 
that we can find ways of enforcing much, much easier than what 
we are able to do now. Thank you very much, Administrator.
    Thank you, Madam Chair.
    Chairwoman Stabenow. Well, thank you so much, and I will 
underscore that when you talk about paper, we ought to be 
looking at the very best technology and the staffing needed to 
serve our farmers. I know the Department agrees with that, but 
that is a serious issue, a very serious issue.
    Senator Lujan, and then Senator Grassley.
    Senator Lujan. Thank you very much, Chair Stabenow and 
Ranking Member Boozman. I am honored to be with you today, and 
thank you to our panelists, our experts, for coming on in today 
and for all the staff that are here.
    When Secretary Vilsack was before this Committee last year 
I shared my concerns that farmers in New Mexico were being told 
that they were not eligible for preventive plant payments 
because of the Trump administration's rule in the 1-in-4 rule. 
During the hearing, the Secretary testified that the Department 
of Agriculture had made changes in some areas for some 
commodities, but I quote what the Secretary said, ``Our review 
is not finished. We need to continue to look for ways in which 
we can create flexibility.''
    Ms. Bunger, yes or no. Has the Department updated or 
revised preventive planting rules to allow drought-stricken 
farmers to retain much-needed crop insurance coverage during 
extreme droughts?
    Ms. Bunger. Thank you for the question, and we are looking 
at this next year revising those proposed rules. You are right. 
Under the last administration 1-in-4 was expanded nationwide. 
We have come to hear from groups, stakeholders, that we maybe 
did not have all of the conversations that we needed to have.
    1-in-4 is very regionalized in a lot of cases, and so for 
this coming year we have made an exception for several Western 
States to step outside of that 1-in-4, and over this next year 
we hope to, with appropriate stakeholder feedback, that we get 
better information so that we can maybe come up with a long-
term solution. I welcome the opportunity to continue to talk 
with your region, with other stakeholders in the Western part 
of the country.
    Senator Lujan. Ms. Bunger, if I follow it correctly, USDA 
is hoping to take action within the year. USDA has created a 
waiver, created a process for Western States or other States to 
be able to apply for this program and make their case?
    Ms. Bunger. Correct.
    Senator Lujan. I appreciate that.
    Ms. Bunger. In a simple answer, yes. There is a waiver this 
year for several Western States. We can get you those States 
that have been identified. I do know your State is included in 
that waiver.
    Senator Lujan. I appreciate that. I think we can all agree 
that there are wet States and there are dry States, and when 
policy is created for the Everglades it might not work out in 
the mountain desert.
    Ms. Bunger. Yes.
    Senator Lujan. I think this is just common sense.
    Ms. Bunger. Right.
    Senator Lujan. We do not have the water that they do down 
in that beautiful part of America. We are pretty for other 
reasons. I am hopeful that this will be looked at the way it 
should be, that Western States get treated the same as Eastern 
States, because when I look at USDA--and now I am going off-
script so I apologize to my staff--when I looked at the way 
that USDA allocates money, Western States do not do so well. 
You compare New Mexico to the region States or the Western 
States to the other States, it is not as well as it should be. 
It is not equitable.
    When the rules are changed so that a State cannot even 
compete something is broken. We are the United States of 
America, and these programs are made for producers all over the 
country that contribute to the welfare of the United States. I 
am hopeful that we can make progress, and whatever I can do to 
encourage more participation from Western States, and 
especially in New Mexico, I will be on the phone again with the 
Secretary to ensure that they have been working closely with 
you in these particular areas as well.
    I apologize for showing a little passion there.
    Now New Mexico prides itself on a diverse set of crops that 
we grow, especially our chile, which we are very proud of, 
pecans, pistachios. We do great with nuts as well. A vital 
purpose of the farm bill is to provide a safety net to 
producers to ensure that they are able to protect their farms 
and livelihood. Tools like crop insurance are vital in that 
mission. Options for specialty crops are not at the levels 
provided for other crops, as we know.
    Ms. Bunger, how can Congress expand and strengthen these 
programs to ensure that they are a viable and reliable safety 
net for all farmers, and because my time has expired I will 
submit these into the record and that way we can work with you 
on these as well, on specialty crops across the country that 
might benefit. Thank you. Thank you very much.
    Chairwoman Stabenow. Well, and thank you, Senator Lujan. I 
am so pleased you are a part of this Committee to raise really 
important issues and concerns for, I know, New Mexico, and 
other Southwestern States. Thank you very much.
    Senator Grassley.
    Senator Grassley. My staff has told me since I have not 
been here for all of this meeting that the issue of payment 
limitations has not come up yet, so my first question is to Mr. 
Ducheneaux, and I am going to lead in with this.
    As it stands, the largest 10 percent of farmers receive 
nearly 70 percent of the subsidies from Title I programs. 
Because of this, large farmers get higher payments and drive 
land prices up. This is one of the many reasons it is hard for 
young and beginning farmers to get started, and that is why, 
during the 2018 Farm Bill I proposed my amendments that would 
have enacted common-sense payment limits. Instead, the previous 
farm bill was intentionally written to help the wealthiest 
farmers, even relatives with no direct connection to the land, 
receive unlimited subsidies from taxpayers.
    Now the Government Accountability Office says the USDA is 
not routinely reviewing FSA operations to ensure compliance 
meets the legal terms actually engage standards to qualify for 
the payments. My first question is, what steps have you taken 
to provide better oversight to farm payments and to comply with 
the GAO recommendations?
    Mr. Ducheneaux. Thank you, Senator. Payment limitations 
come up every time we roll out a program, and our staff and the 
county offices do a great job of vetting those operations. I 
was just in a conversation with one of our CEDs in South 
Dakota, and a farm there had to submit three ring binders full 
of paper to prove up that they were structured as they said. 
Our staff doing a great job at that, the discussion around what 
payment limitations should be. That is something that Congress 
will give us guidance on, as it has in the past, and we will 
continue to carry that out to the best of our ability. We are 
vetting them as diligently as we have the capacity to, sir.
    Senator Grassley. Okay. What steps has the FSA taken to 
ensure producers are meeting the legal term actively engaged 
standards to qualify for payments?
    Mr. Ducheneaux. Again, we review the files periodically of 
farms selected at random through spot checks as opposed to 
devoting the staff resource to reviewing every single 
operation. We have got to have a process that can sort of mine 
the data, sort of get at that.
    Senator Grassley. My last question is, are there specific 
reforms that could better ensure programs reach working farmers 
and non-landowners on Wall Street, living thousands of miles 
away?
    Mr. Ducheneaux. Sir, we continue to look for the 
flexibility that we have within the statutes to do that, and we 
are going to try to find that flexibility that we have, and we 
welcome conversations with you about what those reforms might 
be on the statutory level.
    Senator Grassley. Yes. Next, for Secretary Bonnie, USDA is 
investigating more than 3 and 1/10th billion for 141 projects 
through partnerships for climate-smart commodities. Spending 
over $3 billion without input from Congress is of serious 
concern. It should be for everybody in the Congress. It is my 
belief that Congress should not continue to allow USDA to both 
authorize and appropriate for new programs.
    So, Secretary, does USDA have plans for any other new 
programs using money from the Commodity Credit Corporation 
without input from Congress?
    Mr. Bonnie. I would that, you know, Congress, in the 
Charter Act of the Commodity Credit Corporation, has given USDA 
the authorities under it, and those are the authorities we used 
in rolling out the partnerships for climate-smart commodities. 
We have stuck very close to make sure, in Charter Act 5(e) that 
we track the statute very closely. It is a commodity program 
that seeks to expand and create new markets for commodity. It 
comes right out of that language.
    For that program we do not have any plans to expand it, and 
I would just say I think we will continue to use the authority 
that the Congress has given us through the Charter Act.
    Senator Grassley. Well, are you planning to use it for any 
other new programs, other than the one we have just talked 
about?
    Mr. Bonnie. I will speak to my mission area, and we do not, 
at this point.
    Senator Grassley. Okay. Thank you.
    Another one for you, Mr. Under Secretary. Since 2017, more 
than $60 billion in ad hoc disaster assistance has been 
allocated to supplement crop insurance. If you remember, crop 
insurance was set up so that farmers would have some certainty 
and did not have to rely on Congress for disaster assistance. 
Crop insurance is already the most expensive farm program title 
outside of the nutrition title.
    Do you have suggestions on how we can reduce the sheer size 
of taxpayer dollars that go to supplemental disaster programs?
    Mr. Bonnie. I think we would welcome a conversation with 
all of you on that. As I noted before, we try and structure our 
ad hoc programs in a way that encourage folks to get either 
crop insurance or NAP, and we think that approach continues to 
be important.
    Chairwoman Stabenow. Thank you very much.
    Senator Klobuchar, and then we will turn to Senator 
Marshall.
    Senator Klobuchar. Thank you. I know you got, Mr. Bonnie, 
questions about the Federal crop insurance program, and it is 
such an important corner of our safety net. Any ideas you 
have--most farmers believe it is working well, but do you have 
ideas for change? Any ideas that you want to share to continue 
its effectiveness but also its affordability?
    Mr. Bonnie. Yes. I think we will continue to look at ways 
that we can broaden the program, to get more producers in to 
create more tools, and hearing from all of you. From our 
producers is critically important to that.
    Senator Klobuchar. My staff recently went on an ag staff 
tour, and one issue that was raised was about the Emergency 
Relief Program, and they are grateful for the quick and 
effective approach taken during the implementation of ERP Phase 
One. A number of them have been less enthusiastic of the income 
tax-based approach taken during the rollout of ERP Phase Two.
    Could you speak to any concerns you have heard and how it 
will inform any improvements we should make?
    Mr. Bonnie. The goal in ERP Two is to make sure that we 
make assistance available to all those producers, including 
those producers who have not had access to crop insurance or 
NAP. The purpose here is to provide a revenue-based approach 
that can broaden the safety net to get all those folks in. That 
is what we are trying to do here. We are trying to open the 
doors up to make sure that all of agriculture can take 
advantage.
    If, at the end of that, we have additional resources, then 
we can think about a shallow loss program to deal with some of 
the concerns that I think your producers are raising. We are 
happy to look at that.
    Senator Klobuchar. Okay. Mr. Ducheneaux, we all know, Mr. 
Bonnie has talked about this, the effort to ease the burdens in 
applying for USDA programs. What steps is FSA taking to 
streamline and decrease the turnaround time for guaranteed and 
direct loan applications?
    Mr. Ducheneaux. Thank you, ma'am. I appreciate the 
question. We recently announced that we went from a 29-page 
application down to a 13-page application. A couple of those 
pages are the legalese that we need to have on there, so we are 
down to about a 12-page application that really looks like a 
financial document instead of a narrative-based product. We are 
helping our producers get the right information to our staff so 
that we can ideally make more timely decisions.
    I understand the importance of credit very deeply, being 
the child of the farm financial crisis from the 1980's, so I 
understand how important that is, and understand that a 
decision on credit too late is as a bad as a denial. We really 
want to look at that.
    Senator Klobuchar. Thank you. Okay.
    Mr. Bonnie, Senator Thune and I have recently introduced 
the Ag Innovation Act, which would help farmers determine the 
value of emerging conservation and production practices. Do you 
have an update on the status of the report that we included, a 
requirement in the 2018 Farm Bill?
    Mr. Bonnie. I do not. I will be happy to get back with your 
staff on that. I would just say I really appreciate your 
leadership on this issue. It is critically important.
    Senator Klobuchar. Okay. Again for you, Mr. Bonnie. This is 
on dairy. Small and medium-sized dairy farms make up the 
majority, still, of dairy farms in the Nation. It is certainly 
true in my State. When evaluating dairy programs like the Dairy 
Margin Coverage Program what would be the most helpful to keep 
our small and medium-sized farms in business when we look at 
any policy changes?
    Mr. Bonnie. I think it has been a really, really program. 
As I mentioned earlier, we try to update the prices to make 
sure it is as effective as we can and reflective of what 
producers are seeing on the ground and to provide supplemental 
questions as well. I think we would welcome a conversation with 
all of you to make sure it continues to work for our producers.
    Senator Klobuchar. Okay. Thank you. I appreciate your short 
answers. It just allows us to get into--you are not 
filibustering. It is like the best thing ever.
    In last week's hearing your colleague, Under Secretary 
Taylor, Ms. Bonnie, confirmed that she would work together with 
you to maintain a stocks-to-use level in the United States 
between 13.5 and 15.5 percent, which provides for a reliable 
and stable supply of sugar to both consumers and food 
manufacturers. Do you feel that range represents an adequate 
supply for the U.S.?
    Mr. Bonnie. I can give you a really short answer on that 
one--yes.
    Senator Klobuchar. Okay. Very good. Last, Ms. Bunger, thank 
you. Given the challenges producers, especially crop producers, 
have faced over the last five years, and the lessons we have 
learned from the disaster assistance, some of it ad hoc, we 
have had some good experiences and bad in the Midwest but many 
good experiences as well. What recommendations do you have to 
improve crop insurance options for specialty crop growers?
    Ms. Bunger. I think the best way to get the most results is 
to engage with stakeholders. We see a significant amount of 
interest in our whole-farm revenue policy, with our RMA road 
shows, along with our microfarm, especially with the changes we 
have made to reduce the red tape when applying for those types 
of policies. We have increased the revenue limits for both of 
those. The RMA road shows have been very successful with 
getting that education out. We have seen now probably close to 
1,000 people that have listened in and have really appreciated 
our efforts with that.
    We are not going to try to fix anything that is broken at 
this point. We are going to continue our education efforts.
    Senator Klobuchar. Okay. Thank you. Thank you, Madam Chair.
    Chairwoman Stabenow. Thank you very much.
    As I turn to Senator Marshall I am reminded, I feel like I 
have been channeling our former Chair--well, not only the t-
shirt but Senator Roberts as the father of crop insurance. I 
feel like he has been on my shoulder all morning, as I have 
been talking about the importance of crop insurance. You are 
welcome to say like 10 seconds about your shirt, if you would 
like to.
    [Laughter.]
    Senator Marshall. The Vikings won Super Bowl IV. The Chiefs 
won 23-7, not that I keep track of these things.
    Okay. Yes. I can guarantee you Senator Roberts will be in 
front of the television Sunday, 6:30 p.m. Eastern, to watch the 
Chiefs win, 33-31. Chris Jones will be the MVP.
    Chairwoman Stabenow. Oh, my gosh. There you have heard it, 
folks. All right.
    Senator Marshall. You heard it here first.
    Chairwoman Stabenow. All right. We will see about any bets. 
Okay.
    Senator Marshall. Madam Chair, it is a pleasure to be here 
today. Make no mistake about it. This hearing on crop insurance 
and Title I funding is the No. 1 farm bill hearing we are going 
to have for producers in Kansas, that no doubt, without crop 
insurance, without Title I funding, many farmers would be out 
of business.
    I want to take a moment and speak to all my other members 
across the aisle, and maybe some of their staff members who may 
be more from urban States, and talk about why crop insurance is 
so important to everybody in America. Think about school 
lunches. Think about our nutrition programs. Everyone has got a 
favorite memory of their school lunch. Madam Chairwoman, like I 
liked the chili, which was one of my favorites, chicken and 
noodles. Any favorites that were yours?
    Chairwoman Stabenow. I do not know. I would have to think 
about it for a second here.
    Senator Marshall. Well, you know, the great thing was when 
I was growing up I could count on, at a lunch, every time, that 
we would have rolls and whole milk. I would get two cartons of 
whole milk and two rolls. The cinnamon rolls came with the 
chili. That was always good. There was a nickel worth of wheat 
to make a loaf of bread when I was growing up. A nickel's worth 
of wheat would make a whole stack of rolls, and today, still a 
nickel's worth of wheat will make a loaf of bread.
    We used to get brownies too, on Fridays. I would suppose 
there was a nickel's worth of sugar in a tray of brownies 
growing up, and there is still a nickel's worth of sugar in 
brownies today, if kids still get brownies or not. I do not 
know.
    My point is crop insurance and Title I funding are working 
to keep the cost of food down. Look at our SNAP program, the 
cost of it has gone up. We budgeted, I do not know, $70, $80 
billion a year, and it may be $130 billion this year. Without 
crop insurance, without Title I funding, that budget would be 
the roof as well, that allows farmers to stay in production, 
allowing them to produce next year's crop. I cannot stress 
enough how important crop insurance, Title I funding is to all 
Americans.
    So a couple of questions, and these are probably more 
technical questions as well. The first one is for Under 
Secretary Bonnie. It has to do with LLCs. Since farming is an 
inherently risky business most accountants and attorneys would 
advise that businesses be structured as an LLC. Do you support 
including LLCs that are taxed as a partnership under the 
definition of a joint enterprise?
    Mr. Bonnie. I think our response is to keep things the way 
they are. This is the way multiple administrations have dealt 
with this, and as we discussed earlier, there are some big 
implications for changes here.
    Senator Marshall. Okay. The second question, for 
Administrator Ducheneaux. Let us talk about ELAP programs. This 
past year, we had a fire that went through a lot of our 
grasslands, literally clocked at moving at over 100 miles an 
hour. Some of our ranchers had some pasture land set aside to 
graze their cattle on this winter, and, of course, that was 
destroyed. Because the current ELAP program does not 
contemplate damage to stored forage outside of normal grazing 
seasons, would you support adjusting the regulations or statute 
to ensure future losses of such nature are covered?
    Mr. Ducheneaux. Sir, we would sure welcome an opportunity 
to engage in some technical assistance on that to make sure we 
got it right. I had a chance to get out and visit a couple of 
those affected ranches out there in that part of the country 
and it was devastating. The grace that those folks showed 
hosting us, while waiting for assistance that had yet to get 
them, was really moving. We have got to be able to do a better 
job at that, and we look forward to working with you and your 
team to get there on it.
    Senator Marshall. I do appreciate just the sense of 
community, people coming from all over the nature, bringing 
hay, bringing fenceposts, bringing barbed wire. We helped to 
collect some of those things. I appreciate you mentioning that 
as well.
    The next one is for Administrator Bunger. The Federal Crop 
Insurance Board that is tasked with reviewing and approving new 
and improved policies has been shorthanded since early in this 
Administration's tenure and are still operating virtually. Can 
you tell me when you expect to have these seats filled? When 
can we expect the board to begin working again fully in person?
    Ms. Bunger. Thank you for the question. Yes, we are 
currently in the process of reviewing two seats that are 
currently vacant. They are farmer seats. That is how I identify 
them. The board, in its current status, is very functional as 
it is. They continue to review all of the submissions as they 
come through. We have been maintaining the integrity of that 
process, and we hope to soon be able to fill those positions. 
The farmer seats are very critical when it comes to the makeup 
of that board.
    Senator Marshall. You do not expect them to be working in 
person?
    Ms. Bunger. No, this next meeting they will be working in 
person. We are looking at both virtually and in-person, both 
ways, to have our FCIC board meetings.
    Senator Marshall. Okay. Thank you. I yield back.
    Chairwoman Stabenow. Thank you very much. Just for the 
record, anyone wanting to talk about the Eagles this morning 
will get equal time.
    All right. Yes, Senator Hoeven, I know--oh, Senator 
Warnock. Good morning. I know you were presiding. I am so glad 
that you were able to join us. We all have multiple duties in 
the morning, so I am glad you are joining us, just in time for 
me to call on you. Senator Warnock.
    Senator Warnock. Thank you so much. I know a little bit 
about multitasking.
    Chairwoman Stabenow. Yes, exactly.
    Senator Warnock. Thank you so very much, Madam Chair. 
Thanks to all of our witnesses who are here.
    Georgia is known as the Peace State, and while we are very 
proud of the peaches we produce we produce and are a leading 
producer of many other specialty crops like blueberries, 
watermelon, and Vidalia sweet onions. Fully vegetable growers 
in Georgia and throughout the Southeast have limited viable 
options when it comes to insuring their crops against natural 
disasters, and Georgia growers are already struggling with 
market challenges by lower-cost fruits and vegetables imported 
from other countries. USDA must do all that it can to provide 
these farmers with more certainty.
    Administrator Bunger, from your perspective what are some 
of the unique challenges facing fruit and vegetable growers in 
Georgia and throughout the Southeast?
    Ms. Bunger. Thank you for the question. Like I mentioned 
earlier, my husband and I, being row crop farmers in the 
Dakotas over the last 27 years, crop insurance has been a 
cornerstone of our operation. It is my commitment that 
specialty crop growers, growers of vegetables, fruits, all too 
have the same type of policy so that they can experience the 
same levels of coverage.
    So we continue to work and expand our programs. We have 
recently announced expansion with the revenue limits on whole-
farm revenue protection, which would be a possibility for some 
of your growers, along with microfarm, where we have tripled 
the revenue limits on that. We have reduced the red tape for 
those types of policies to make it more accessible to specialty 
crop growers. We have recently introduced a strawberry policy 
that is now available.
    We just continue to look toward the different avenues as 
ways to have policies come to all of the growers across the 
country, not just your traditional growers.
    Senator Warnock. Do you think this will provide more cost-
effective options for growers?
    Ms. Bunger. Yes. Whole-farm and microfarm are both revenue 
types of products that encompasses growers' small operations 
but at the same time their diverse operations.
    Senator Warnock. Do you think it will enable some small and 
independent farmers, who would like to get in this specialty 
space--I have talked to some of them across Georgia----
    Ms. Bunger. Yes.
    Senator Warnock [continuing]. do you think it will increase 
their ability to do something like that?
    Ms. Bunger. Yes, because we, too, also have beginning 
farmer components that offer some premium assistance. We also 
have the TOGA program with organics. Again, we just continue to 
look to you. We look through the 508(h) process with private 
submissions, and even internally within the Department to 
continue to expand policies for specialty crop growers.
    Senator Warnock. Great. Thank you. This is something I have 
my eye on as we push forward toward a farm bill 
reauthorization. We want to make sure that our specialty crop 
growers have the protection they need. I am certainly looking 
forward to trying to limit risk and allow other people to get 
into that space so that we create some equity in the process 
and opportunity for new growers, and related to that, make sure 
that we have equity across the spectrum.
    It is estimated that more than one-third of Southern Black-
owned land is considered to be heirs property, property that is 
family owned land. It is passed down informally without a title 
or legal documentation. We all know the awful and sad history 
of this. These issues have not only harmed the ability of these 
families to build intergenerational wealth for centuries but 
also their ability to participate in USDA programs.
    So the legacy itself of these heirs property issues then 
prevent folks from being able to access the very kinds of 
things that should be able to give them a leg up. However USDA 
still has more work to do to overcome years of 
institutionalized discrimination across the agriculture sector. 
For example, there are still no Black-owned community 
development financial institutions enrolled as an intermediary 
lender for the program, and it is undersubscribed.
    Under Secretary Bonnie, how can the USDA work to better 
implement this program so that family farmers can successfully 
pass land down to their children and build intergenerational 
wealth?
    Mr. Bonnie. I appreciate your efforts on this. This is a 
critical issue. I worked on this at the end of the Obama 
Administration in South Carolina, Georgia, and other parts of 
the country. We have got the Heirs Property Relending Program 
right now. We have got two organizations that have come in the 
door, and we are working on a third right now.
    I might turn to my colleague, Zach, to talk, because he 
knows this issue well.
    Mr. Ducheneaux. Certainly. I share the same background. 
Native American producers feel that same plight with 
fractionated land and inability to participate meaningfully in 
programs, so this one really strikes close to home to me as it 
does you, sir.
    The heirship relending program is unique in that it also 
has technical assistance funding to help those producers 
meaningfully participate. One of the things that was a glaring 
void, to me, was the fact that there was not a Black-controlled 
CDFI in the ag industry, and we have worked closely with our 
cooperators, the Federation of Southern Cooperatives, the 
National Black Growers Council to help them understand the 
importance.
    Senator Warnock. How can we improve this in the next farm 
bill? I am almost out of time and I just wanted to make sure we 
are speaking directly to that.
    Mr. Ducheneaux. I will have to provide technical assistant 
on that, but I have a very good idea about how we could make 
that better.
    Senator Warnock. Okay. Thank you so very much, Madam Chair.
    Chairwoman Stabenow. Well, thank you. We very much want to 
hear that idea because this is a very, very important that we 
be able to improve this, so thank you very much.
    Senator Braun.
    Senator Braun. Thank you, Madam Chair. Mr. Ducheneaux, I 
have got to give you a heads up. Senators Stabenow, Boozman, 
and I passed the Growing Climate Solutions Act a long time ago, 
a landslide in the Senate, 92-8. That is as good as I have ever 
seen anything. It got held up in the House. It did go through. 
Is that on your radar for implementation? We spent a lot of 
time and energy to get it across the finish line and it finally 
happened not too long ago.
    Mr. Ducheneaux. Yes, Senator. I appreciate the work on 
that. I remember hearing about that when I first got to town, 
how it had been pretty roundly supported in this house. I am 
glad it finally got all the way through.
    The planning process for that is happening at the 
departmental and Under Secretary levels at this time, so I 
would defer on that to my partner, the Honorable Robert Bonnie.
    Senator Braun. Mr. Bonnie.
    Mr. Bonnie. I really appreciate your leadership on it. It 
is really important, and it dovetails well with other work we 
are doing at the Department to create value for producers for 
market-oriented, private sector investment in agriculture.
    Both FPAC mission area as well as the Chief Economist's 
Office are engaged right now, along with the Secretary. It is a 
high priority. Already starting to think about the advisory 
committee. I know that was important to you in putting that 
legislation together. Work has started on it. It is a high 
priority and we will roll it out in the coming year.
    Senator Braun. Well, very good. For the public that is not 
aware of what it does, it is a practical thing that basically 
matches up farmers' good stewardship using the portal of the 
Farm Service Agency to get the certification for existing 
offset markets. It was a win-win and I think a great example of 
how we can do things here and not necessarily have a fiscal 
along with it of significance. Interesting, it barely made it 
through, so I guess praise the Lord there.
    I have got a couple other questions for you, Mr. Bonnie. 
Recently we have seen the discussion of foreign-ownership of 
land. Indiana and 15 other States--and I think this crosses 
blue and red States--have put laws on the books to do what they 
think is important about weighing in on it.
    I have got a bill called the Protecting America's 
Agricultural Land from Foreign Harm Act, and it would be to 
preclude it in the future from places like China, Iran, North 
Korea, and Russia. Then for those that have already got 
ownership, for them not to be able to participate in the farm 
programs.
    Will the USDA be behind me and others on the effort to get 
this legislation through?
    Mr. Bonnie. I certainly would not commit the Administration 
or the Department to it. We obviously welcome the opportunity 
to provide technical assistance. I will say there was an 
earlier conversation I am not sure you were here for about the 
resources that we need to be able to track this through AFIDA.
    You are a forest owner. I am a forest owner. There are 40 
million acres in the U.S. that have ties to foreign ownership. 
About half of that is forest land, and as we know, a lot of 
that investment is from European countries. They are investing 
in TIMOs and REITs.
    So, you know, a note of caution. We need to make sure we 
think about those issues as well.
    Senator Braun. I think there it would be to have a 
differentiation from business owners and partners that are not 
in the same category as some of the places I mentioned.
    When I travel I am one of the few still, to the extent you 
can be involved--I think Senator Tester actually drives a 
tractor in his spare time. I do but I am not putting a crop in 
the ground--but both tree farming and the row crop side of it. 
For the folks out there that are producing corn, soybean, 
grains, that has become a high-altitude business. I have never 
seen a business where when revenues go up, just mysteriously 
inputs seem to go right up with them and squeeze out whatever 
percentage profit should be there to where sometimes it is even 
hard to scratch an absolute profit out of the picture.
    One thing, again, they are good stewards, and they want to 
make sure that they are never going to have the safety net 
program that they depend on, which is a small part of the money 
that we spend on the farm bill, tied directly to having to be 
forced into conservation practices, which they do voluntarily. 
Just the reference I made earlier, they are doing that and now 
we maybe can get some help with the offset markets.
    Where are you going to be on making sure that that never 
gets connected to where you are going to get this only if you 
do that?
    Mr. Bonnie. Our approach to climate, and conservation more 
broadly, is going to be voluntary, incentive-based, 
collaborative. We look for opportunities to work with 
producers. That is going to cut across everything we do. We 
think if it does not work for agriculture and forestry it is 
not going to work for the environment.
    Senator Braun. You are saying that, it sounds you would 
never be for something where you are tying it as a condition 
for your safety net?
    Mr. Bonnie. I mean, we obviously have compliance and crop 
insurance and FSA programs. We think that is a good approach. 
Beyond that, our approach on these issues is going to be one 
that is about voluntary stewardship.
    Senator Braun. Thank you.
    Chairwoman Stabenow. Thank you very much. I do know that 
there is a vote going on. I am going to turn to Senator Hoeven, 
and then if Senator Welch is back with us we will hear from him 
as well and then close out the hearing. Senator Hoeven.
    Senator Hoeven. Thank you, Madam Chair. Thanks to you and 
the Ranking Member for calling this hearing. Thanks to all 
three of you for being here. Also, having worked with all three 
of you, thanks for what you are doing on behalf of farmers. I 
appreciate it. We have come to you and asked for help, and it 
has not always been exactly what we want but you are working 
hard and trying to work on these things with us. That matters. 
Even if we do not get exactly what we want, which of course we 
never do, if you are working and you help us and we make some 
progress, it makes a huge difference, and you have all done 
that. We appreciate that as we go into the farm bill. That 
attitude and that willingness to work together is incredibly 
important. I want to express my appreciation up front for that 
approach.
    Secretary Bonnie, you were out recently working on a number 
of things, and in terms of the sugar program it is incredibly 
important that we enforce those TRQs. I think it was good you 
got a better understanding of the sugar program while you were 
out there. Are you committed to continuing to do that, like we 
discussed?
    Mr. Bonnie. Yes.
    Senator Hoeven. Then the crop insurance, if we do, in the 
farm bill, the best possible job on the farm bill, and on the 
countercyclical safety net, ARC and PLC, we put ourselves in a 
position to reduce the need for ad hoc disaster packages. Are 
you committed to working with us to make the crop insurance and 
the safety net as strong as possible and with flexibility? If 
we do that well, it would make a huge difference for the next 
five years, not just for our farmers and ranchers. Of course, 
everybody benefits. Every American benefits, every single day, 
from the highest quality, lowest cost food supply that our 
farmers and ranchers provide. We are doing something for every 
single American. If we do a good job on that--and it is the 
most cost-effective way to do it as well, so we are not having 
to do more of these ad hoc disaster packages.
    I would ask that question. Are all three of you committed 
to those two priorities in the farm bill?
    Mr. Bonnie. Yes.
    Ms. Bunger. Yes.
    Mr. Ducheneaux. Yes, sir.
    Senator Hoeven. Then, Secretary Bonnie, WHIP+ ERP has been 
really helpful, and ELRP, for the livestock administrator, 
thank you to you as well. Your second iteration is not working 
as well as ERP I. Both are WHIP+ based. That is the underlying 
legislation, which we worked to pass, but Version Two needs 
some work. We need to adhere more to Version One, based on the 
feedback we are getting from the farmers.
    Mr. Bonnie. Yes, so I mentioned this earlier, and I will 
turn it over to Zach in a second. Our approach on ERP II is to 
make sure we get those producers who did not have access to 
crop insurance, did not have access to NAP. We think that 
revenue-based approach does that. We think it will bring in new 
customers.
    As I noted earlier, if there are resources left over for a 
shallow loss program, which I think some of the concerns that 
we are hearing are talking about, we are happy to look at that. 
We think this approach allows us to get more producers in.
    Senator Hoeven. Well, I understand that, and I understand 
there are some funding issues, the dollars relative to the need 
in WHIP Two. We are getting a lot more pushback, so I just 
wanted to report that to you. I mean, you all call it ERP now, 
but it is all WHIP+. It is fine. We need to do some more back-
and-forth work on that, I think. I get it. I get some of the 
constraints in Version Two and I did talk to the Secretary 
about it as well.
    Commissioner Ducheneaux, again, a big thanks to you on our 
livestock programs, and your willingness to work together has 
been really good. What improvements do we need to make for 
our--I mean, I have some ideas as far as--we need to take some 
of these programs that we have for livestock, whether it is 
LIP, ELAP, a number of them, and also in the farm bill figure 
out how we strengthen them, enhance them, put some flexibility 
in them, update them for current times. Same thing. It will 
reduce the need for disaster assistance down the line. That 
helps our ranchers. That helps the taxpayers.
    So what are your thoughts there in terms of what we can do 
as far as strengthening those programs?
    Mr. Ducheneaux. One of the things we hear from stakeholders 
when we go around the country, sir, and we heard it in North 
Dakota during the drought tour, is our livestock programs lag 
behind our crop programs a little bit, just by virtue of being 
newer----
    Senator Hoeven. Exactly.
    Mr. Ducheneaux [continuing]. so there is room to evolve. We 
really appreciate, you mentioned earlier, the flexibility that 
we are offered because that lets us find that solution in a 
more timely manner, and it has enabled us to work closely with 
your staff, for instance, on ELAP, to address the length of the 
hauls that our producers were having to make to mitigate 
drought impact. That flexibility in the programs is every bit 
as important.
    Another of the strengths of those programs is they are 
funded through the Commodity Credit Corporation (CCC), which 
allows us to, again, make more timely decisions.
    Senator Hoeven. Right, and we work with that on Ag Approps, 
so I appreciate that. Senator Tester and I have some 
legislation that will help in this area as well, bipartisan 
legislation.
    Thank you, Madam Chair.
    Chairwoman Stabenow. Thank you very much, and thanks to all 
of you. We have covered a lot of ground today. These farm bill 
investments, we know, are much needed risk management tools, so 
we look forward to you as we move forward.
    I do want to just say, we have a member of our Committee, 
Senator Fetterman, who went to the hospital last night but all 
looks well. It looks like he will be released today. Of course, 
our prayers are with him for what we hope is a very brief visit 
in the hospital.
    Thank you so much and the meeting is adjourned.

    [Whereupon, at 11:26 a.m., the hearing was adjourned.]

      
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