[Congressional Record Volume 147, Number 39 (Thursday, March 22, 2001)]
[House]
[Pages H1089-H1090]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    JUMP-STARTING VALUE-ADDED INITIATIVES FOR AGRICULTURE PRODUCERS

  The SPEAKER pro tempore (Mr. Ferguson). Under a previous order of the 
House, the gentleman from Montana (Mr. Rehberg) is recognized for 5 
minutes.
  Mr. REHBERG. Mr. Speaker, this week, March 18 through March 24, is 
National Agriculture Week. Agriculture is the number one industry in my 
State and last week I introduced, along with the gentleman from South 
Dakota (Mr. Thune) and the gentlewoman from Missouri (Mrs. Emerson), 
two pieces of legislation that I believe will be very important in ag 
country.
  The past few years have brought widespread disasters and record low 
prices to the agriculture economy. These harsh conditions have prompted 
some farmers to call for a debate on current farm policy and others to 
demand a better safety net for producers. While a safety net is 
important to producers, especially in lean years, America's farmers and 
ranchers do not want

[[Page H1090]]

to be dependent on the Federal Government for their livelihood. 
Consequently, the Federal Government must develop a long-term, market-
oriented approach to Federal farm policy that will provide producers 
with the tools to help themselves, while at the same time bringing 
much-needed economic development to rural communities.
  Stakeholders in American agriculture recognize that while short-term 
financial assistance is helpful, long-term planning and creative and 
innovative opportunities are necessary in order to stem the loss of 
small, family-owned farms and preserve small-town economies.
  Encouraging agricultural producers to launch value-added enterprises 
will do just that by enabling farmers and ranchers to reach up the 
marketing chain and capture profits generated from processing their raw 
commodities.
  While producers have great interest in pooling together to add value 
to their raw products, two primary barriers stand in their way: first, 
producers often do not have the technical expertise to launch extremely 
complex business ventures, like value-added enterprises. Producers are 
experts, but they are experts in their own fields. Farmers are often 
outside their arena when it comes to putting together complex 
processing plants.
  Second, producers are currently cash strapped. Even if enough capital 
could be accumulated to initiate development of producer-owned, value-
added processing, many of the consolidated players in the market could 
squeeze producer-owned entities out before they become profitable. 
Therefore, something needs to be done to level the playing field for 
these producers.
  That is why, together with the gentleman from South Dakota (Mr. 
Thune) and the gentlewoman from Missouri (Mrs. Emerson), I have 
introduced two bills to help jump-start value-added initiatives for 
those producers who need more help to overcome the barriers they face.
  The Value-Added Agriculture Development Act would grant $50 million 
to create agricultural innovation centers for 3 years on a 
demonstration basis. The ag innovation centers would provide 
desperately needed technical expertise, engineering, business, research 
and legal services to assist producers in forming producer-owned value-
added endeavors.
  The companion bill, the Value-Added Agriculture Investment Tax Credit 
Act, would create a tax credit program for farmers who invest in 
producer-owned value-added endeavors. This program would provide an 
incentive to invest in value-added production by assisting cash-
strapped producers.
  Specifically, the bill would make available a 50 percent tax credit 
for farmers who invest in a producer-owned value-added enterprise. 
Producers can apply the tax credit over 20 subsequent years or transfer 
the tax credit to allow for the cyclical nature of farm incomes.
  For example, sugar beet growers in the Yellowstone Valley in Montana 
have the potential to purchase the Great Western sugar refinery. This 
legislation could provide much-needed tax relief for the grower, 
turning a ``maybe'' purchase into a ``possible'' purchase.
  With our tax credit bill, each grower would claim as much as a 
$30,000 tax credit for his $60,000 investment towards the purchase of 
this plant. That may be enough assistance for the producers to remain 
in a business so important to Montana's economy.
  I have always said that government does not create jobs, people do. 
Something government can do, however, is create an environment that 
gives incentives to entrepreneurs and enables businesses to flourish. 
That is what this package of legislation does: it provides American 
family farmers with the tools and incentives they desperately need to 
transform themselves from price-takers to price-makers. Because of 
this, the legislation has been endorsed by the Montana Farmers Union, 
Montana Wool Growers, Montana Farm Bureau, Safflower Growers 
Associations, R-CALF, Montana Stock Growers, Mountain States Beet 
Growers Association of Montana, and Montana Grain Growers.
  Agriculture is Montana's number one industry, and what is good for 
agriculture is good for Montana. By developing value-added industries, 
we can bring some economic development to Montana and other rural 
States. That is good for our pocketbooks, our communities, and our way 
of life.

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