[Congressional Record Volume 145, Number 118 (Monday, September 13, 1999)]
[Senate]
[Pages S10780-S10782]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ROBERTS (for himself, Mr. Kerrey, Mr. Craig, Mr. Burns, 
        Mr. Baucus, Mr. Grassley, Mr. Santorum, Mr. Crapo, Mr. Johnson, 
        Mr. Thomas, Mr. Brownback, Mr. Hagel, Mr. Daschle, Mr. Harkin, 
        Mr. Enzi, Mr. Inhofe, and Mr. Conrad):
  S. 1580. A bill to amend the Federal Crop Insurance Act to assist 
agricultural producers in managing risk, and for other purposes; to the 
Committee on Agriculture, Nutrition, and Forestry.


                risk management for the 21st century act

  Mr. ROBERTS. Mr. President, I rise today to introduce on behalf of 
myself, Senator Kerrey of Nebraska, and a bipartisan group of 17 of our 
colleagues--including a majority of the members of the Senate 
Agriculture Committee, the ``Risk Management for the 21st Century 
Act.''
  This legislation represents a significant step in improving the risk 
management tools available to producers throughout the United States.
  In early March, Senator Kerrey and I joined to introduce S. 529, the 
``Crop Insurance for the 21st Century Act.'' At the time, we stated 
that we did not necessarily believe it was ``the bill,'' but that we 
hoped it would serve as the starting point for a discussion that would 
lead to the introduction of a comprehensive piece of legislation to 
improve the risk management tools available to producers throughout the 
U.S. and which could be supported by a majority of our colleagues.
  I believe this is that bill. Going back to last fall and through this 
spring and summer, we have been involved in literally hundreds of hours 
of discussions with producers, commodity and farm organizations, 
insuranceproviders, insurance agents, and Members of the House and 
Senate regarding what needs to be done to improve the risk management 
tools available to our farmers and ranchers.
  The bill we introduce today is the product of these many discussions.
  This bill includes many of the provisions included in the original 
Roberts/Kerrey legislation, but it also includes many new provisions 
recommended during our discussions with Members and agricultural 
organizations. These include:
  An inverted subsidy structure.
  An equal level of subsidy for revenue insurance products.
  APH adjustments for producers suffering multiple years of crop 
losses.
  APH adjustments for new and beginning farmers, those farming new 
land, and those rotating crops.
  Instructions to undertake alternative rating methodologies for low 
risk producers and regions and crops with low participation percentages 
and to then implement this new rating system. This at the request of 
many of our southern colleagues.
  Changes in prevented planting and incentives to encourage producers 
to take additional risk management measures. Similar to car insurance, 
if you take drivers education classes you get an additional discount on 
your premium. Under our legislation, producers who take additional risk 
management steps will also receive a bonus discount on their premiums.
  Authority for several pilot programs, placing special emphasis on 
polices to explore coverage for livestock and to expand the quality and 
levels of coverage available to specialty crops.
  Mr. President, in addition to the many changes mentioned above, our 
legislation also provides for major changes in the Risk Management 
Agency (RMA) and the regulatory process governing the crop insurance 
program.

  We change the members of the Federal Crop Insurance Corporation's 
Board of Directors to include:
  Four Farmers from geographic regions to be determined by the 
Secretary.

[[Page S10782]]

  One member active in the crop insurance industry.
  One member with reinsurance expertise.
  The Undersecretary for Farm and Foreign Agricultural Services, the 
Undersecretary for Rural Development, and the USDA Chief Economist.

  Make the FCIC the overseer of RMA.
  Create an Office of Private Sector Partnership to serve as a liaison 
between private sector companies and the FCIC Board of Directors.
  Allow companies to charge minimal fees to other companies selling 
their products, in order to allow the recovery of research and 
development costs.

  Mr. President, our legislation also focuses on several areas that I 
want to place special emphasis on because they are areas that I know 
are of interest to many of my colleagues and which some often think 
those of us in the Midwest and Plains States tend to ignore.
  The first deals with program compliance. We have heard complaints 
from some of our colleagues and specific commodity groups that fraud 
exists in several areas of the country. Let me make clear, Senator 
Kerrey and I oppose any attempts to defraud the crop insurance program.
  To prevent this fraud, the legislation calls for penalties of up to 
$10,000 for producers, agents, loss adjusters, and approved insurance 
providers that attempt to defraud the program. It also allows for USDA 
to remove producers from eligibility for all USDA programs if they have 
defrauded the program. Furthermore, agents, loss adjusters, and 
approved companies that do business in the program could be banned from 
participation for up to five years if they have committed fraud.
  Mr. President, these provisions are strong and they are clear--those 
who attempt to defraud the program and taxpayers will be punished.
  Mr. President, another concern that Senator Kerrey and I have heard 
repeatedly is the lack of emphasis and prioritization for specialty 
crops and development of new crop insurance and risk management tools 
for these crops. We have included many provisions in our legislation to 
address these concerns.
  These specialty crop provisions include:
  Changes in the Noninsured Assistance Program that we believe will 
make it easier to obtain assistance and funding through changes in 
which commodities can be covered and by allowing payments in some 
instances irregardless of an area trigger occurring.
  Several pilot projects geared specifically towards looking at the 
feasibility of Gross Revenue and Whole Farm Revenue polices that 
include coverage for specialty crops.
  Requiring the newly created Office of Private Sector Partnership to 
include staff with specialty crop expertise.
  Allow RMA to spend up to $20 million per year to create partnerships 
with Land Grant Universities, the Agricultural Research Service, 
National Oceanic and Atmospheric Administration, and other qualified 
entities to develop and implement new specialty crop risk management 
options.
  Requires 50 percent of RMA's research and development funds to go to 
specialty crop products development. Additionally, 50 percent of these 
R&D funds must be contracted out to organizations and entities outside 
RMA.
  Reaffirms the authority of the Specialty Crops Coordinator in RMA. 
The bill also allows the Specialty Crops Coordinator to make 
competitive grants for research and development of new products in the 
specialty crops area.
  Contains provisions regarding sales closing dates and the issuance of 
new polices.
  Orders the Specialty Crops coordinator and the FCIC to study the 
feasibility of offering cost-of production, Adjusted Gross Income 
(AGI), quality-based policies, and an intermediate coverage level 
(higher than current CAT coverage) for specialty crops.
  Requires the Board to annually review and certify that speciality 
crops are adequately covered. If insufficient coverage is available for 
a commodity, the Board can require RMA to undertake R&D activities.
  Provides mechanisms whereby the Secretary must take steps to improve 
participation in the program when total participation for a crop in an 
individual state falls below 75 percent of the national participation 
average.
  Mr. President, these changes for specialty crops are significant and 
we believe they give important attention to a group of producers that 
has often felt neglected in U.S. agricultural policy. I hope that our 
colleagues will agree and that they will join us in supporting this 
legislation.

  Mr. President, let me also state that I realize some will argue that 
specific provisions should have been included in this legislation that 
currently are not. I understand these concerns, but as we developed 
this bill, we had to determine the priorities of each agricultural 
region and commodity groups. There is something from this bill that all 
of us would like to see included, including Senator Kerrey and myself, 
but as a whole it is I believe the best package available.
  I also realize that some in this body claim that crop insurance is 
not necessary and that we do not need to act on this legislation this 
year. I could not disagree more.
  Mr. President, every year our producers put the seed in the ground 
and believe that with a little faith and luck they will produce a crop. 
But, sometimes the creeks do rise and the multiple perils of drought, 
flood, fire, hail, blizzard, pests, and disease get the better or our 
producers. They must have the tools to manage these risks.
  The agricultural and lending communities have spoken loudly, and they 
all have continually expressed the need to improve the risk management 
tools available to producers throughout the U.S. It is time for us to 
move towards action on this issue. The House Agriculture Committee 
approved legislation prior to the August recess. It is time for the 
Senate Agriculture Committee to do the same. A majority of the 
Committee has said as much by supporting our legislation.
  Mr. President, we know there are many disagreements within members of 
the Senate in regards to specific agricultural policy. In fact, Senator 
Kerrey and I have disagreements of our own on the underlying Farm Bill. 
However, we all agree that our producers today cannot be successful 
without access to new, improved, and adequate risk management tools. 
This legislation accomplishes these needs, and I urge my colleagues to 
join us in working towards an improved crop insurance program and risk 
management tools.

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