Wednesday, March 26, 2008

HERE IS THE ISSUE I WISH THE PRESIDENTIAL CANIDATES WOULD DISCUSS

(CQ Today) -- The long-term financial outlook for Social Security and Medicare remained grim but essentially unchanged in 2007, trustees for the two huge entitlements said Tuesday. They warned again that Congress should act soon to shore up the programs, advice that lawmakers will probably ignore. The trustees, in their annual report on the two programs, issued a “Medicare funding warning” for the third year in a row, which will require the next president to propose legislation to cut the share of Medicare costs borne by the government. President Bush this year sent Congress the first such proposal, although Democrats who control both chambers are not expected to act on his legislation. The trustees said in their report that Social Security’s trust funds will become insolvent by 2041, while Medicare’s hospital insurance trust fund will hit that point in 2019. Both dates are the same as those predicted last year. When the Social Security trust funds exhaust their reserves, by law benefits would have to be cut to match annual program revenues. There is no such legal requirement for the the Medicare fund, so the government could react to its insolvency simply by borrowing from the treasury to cover shortfalls. Medicare Part A, which is funded by the hospital insurance trust fund, is projected to begin paying more in benefits than it collects from payroll taxes this year.

Monday, March 24, 2008

COMMODITY PRICES CHANGING THE WAY FARMERS AND ELEVATORS DO BUSINESS

(Lincoln Journal Star) -- Nebraska farmers and grain elevators are being saddled with tens of millions of dollars in extra costs as they try to protect themselves against the risks that go with volatile grain prices. Teacher pension funds and other institutional investors are creating some of that volatility and contributing to financial strains as they back away from the uncertainties of the stock market and turn to massive purchases of futures contracts for wheat and other crops that have been steadily increasing in value. Jim Stewart, a farm financial consultant in Lincoln and also part of a Lancaster County farming operation, said many grain elevators have responded to heavy financial pressure with an unprecedented decision. They're no longer willing to allow farmers to lock in prices for the bushels farmers will deliver from the 2008 harvest. Keith Olsen, a Grant farmer and president of the Nebraska Farm Bureau Federation, is calling on federal regulators to intervene. Olsen said a major objective of an April 22 meeting at the Washington, D.C., offices of the Commodity Futures Trading Commission is to explore the price impact institutional investors are having in futures markets.

Friday, March 21, 2008

AS IF YOU DIDN'T KNOW - LAND PRICES UP IN 2007

(AP) -- Nebraska farmland values soared 23% last year as crop prices remained strong, according to a report released Thursday. It's the biggest one-year gain in average land values since the UNL survey began 30 years ago. The latest survey showed that Nebraska farmland was worth $1,425 per acre on Feb. 1 -- 88% higher than in 2003. Ag economist Bruce Johnson said land values reached an all-time high in 2007 even after the figures are adjusted for inflation. Strong demand for corn from the growing ethanol industry and from other countries has helped push crop prices higher, and Johnson said that has fueled the rise in land prices. The biggest land value increases were recorded in the eastern third of the state, where farm ground averaged $3,478 per acre, up 24%. Rental rates for ag land increased between 17% and 23% across the state last year.

GREAT SONG TITLES

Here are some funny song titles from Aaron Wilburn's video on You Tube.

  • How can I miss you when you won't go away?

  • If I shot you when I wanted to, I'd be out by now.

  • I'm so miserable without you, it's almost like having you here.

  • Take me out to the cornfield honey, I'll kiss you between the ears.

  • The oil is all in Texas, but the dipsticks are in DC.

  • If the phone doesn't ring, you'll know it's me.

  • When you leave, walk out backwards so I'll think you're coming in.

  • If you won't leave me alone, I'll find someone who will.

  • Sorry I made you cry, but at least your face is cleaner.
To view the whole video on You Tube, visit the following link. If My Nose Was Running Money

WHERE IS MY STIMULUS CHECK?

More than a quarter of those receiving economic stimulus payments this year should have their money in mid-May, according to information from the IRS. The date stimulus payments will be distributed will be based on the last two digits of the filer's Social Security number. Those who opted to receive their federal income tax refund via direct deposit will receive their stimulus payment sooner than those who will be sent their money by paper check. Direct deposits will be made from May 2 to May 16, while paper-check mailings will run from May 16 to July 11. Individuals who make at least $3,000 in qualifying income can receive a stimulus payment. Here is the schedule for economic stimulus payments:

Direct deposit

Last two digits of SSN Stimulus payment sent by:

· 00-20 ...........................May 2
· 21-75 ............................May 9
· 76-99 ............................May 16

Paper checks

Last two digits of SSN Check in the mail by:

· 00-09 ...........................May 16
· 10-18 ............................May 23
· 19-25 ............................May 30
· 26-38 ...........................June 6
· 39-51 ...........................June 13
· 52-63 ...........................June 20
· 64-75 ...........................June 27
· 76-87 ...........................July 4
· 88-99 ...........................July 11

HAPPY NATIONAL AGRICULTURE WEEK

(KHAS TV, Hastings) -- Nebraskans are celebrating our state's leading industry this week during National Agriculture Week. There are more than 47,000 farms and ranches in Nebraska. They brought in more than $12 billion to Nebraska's economy last year alone. One in every three jobs in the state is ag related. Nebraska is number one in red meat production and number three in corn production in the entire U.S. "It is important that not just here in Nebraska, but that everybody across the entire country understands and appreciates what goes into ag and food production," said Greg Baxter, T & E Cattle Company. Officials say each farmer in Nebraska produces enough food every year to feed 129 people.

FARM GROUPS IN OPPOSITION TO REVIVED INITIATIVE 300 BILL

(Nebraska Ag Connection) -- In a joint letter delivered to state senators, several Nebraska organizations have expressed strong opposition to LB1174, the legislation designed to replace Initiative 300. Groups signing the letter included the Nebraska Cattlemen, Nebraska Corn Growers Association, Nebraska Soybean Association, Nebraska Pork Producers, Nebraska Poultry Industries, Nebraska Chamber of Commerce & Industry, Nebraska Chapter of the American Society of Farm Managers and Rural Appraisers, Nebraska Bankers Association and Nebraska Farm Bureau. The letter states that, if passed, LB1174 "would have a detrimental effect on Nebraska agriculture, putting more regulations on family farmers at a time when they actually need more flexibility to secure capital support through a variety of business relationships." According to the letter, LB1174 also limits the choices of retiring farmers in transferring their farm operations to younger generations, limits the opportunities for beginning farmers to enter agriculture and takes away several risk management tools that are important for family farms. Todd Stuthman of Columbus, president-elect of the Nebraska Pork Producers Association, is concerned LB1174 would limit the ability of producers to work together. "LB 1174 does not provide the flexibility needed for unrelated farmers or ranchers to combine their efforts and assets to address risk and opportunities in today's agriculture," Stuthman said. "The restrictions would be especially harmful to unrelated beginning farmers who want to pool resources, and retiring farmers who want the ability to transfer their businesses to younger farmers." Despite Initiative 300's presence in the state's constitution, Nebraska had 20% fewer Nebraska farms in 2006 than in 1985, according to the USDA

Thursday, March 20, 2008

NEBRASKANS MOVING FROM RURAL COUNTIES TO METRO AREAS

(Omaha World-Herald) -- The growth of Nebraska's urban population — and the decline of its rural areas — is happening faster than previously thought. The U.S. Census Bureau's latest county population estimates, which were released today, indicate that areas outside the Omaha, Lincoln and Sioux City metropolitan areas have lost nearly 23,000 residents since the 2000 Census — or more than 3,000 people per year. A year ago, the estimated loss for non-metro counties was about 12,000 — less than 2,000 per year. All told, Nebraska has gained more than 63,000 residents so far this decade, to a total of 1,774,571 as of July 2007. But the modest population gains have been skewed overwhelmingly to Nebraska's largest cities and their suburbs. The eight-county Omaha metro area, which includes three Iowa counties, has grown by 8.2% since 2000 and now is just shy of 830,000 residents. Lincoln's two-county metro area has more than 292,000 residents, up 9.5% since 2000. The Norfolk area is down about 1,725 people, or 3.5%, following job losses at meatpacking plants. The biggest declines on a percentage basis have been in the least-populated parts of Nebraska. Twenty-seven of Nebraska's 93 counties have lost at least 10% of their population during this decade. Only one of those counties had more than 10,000 residents. In the 1920s, 40% of the state's residents lived in the 13 most-populous counties. By 1980, 64% did. In 2000, it was 69%. The latest estimates suggest that the top 13 counties account for 72% of all Nebraskans. International migration, which includes illegal immigrants, accounted for 43% of Nebraska's total population growth. Douglas, Lancaster, Hall, Dawson and Dakota counties accounted for about 80% of the state's foreign migrants.

WHERE'S MY REBATE CHECK???













NEW POSITION BY THE IRS ON CROP INSURANCE PROCEEDS

A loss for cash basis farmers on taxing crop insurance proceeds: The proceeds are taxed up front unless more than 50% of the income from the destroyed or damaged crop would be reported the following year, the Tax Court says. In this case, the farmers typically reported only 35% of the income from their sugar beets the next year. So, all the insurance for their destroyed beets is taxed when received (Nelson, 130 TC No. 5).

It appears that now we are going to have to be able to prove that we would not have sold the damaged crop until the following year.

Wednesday, March 19, 2008

QUESTION ON QUALIFYING FOR A TAX REFUND

Q. Could you help me? I read in the paper about money we are supposed to get from the government to stop this depression. I was told that since I was retired and because of my low income, I don’t need to file a tax return. How do I get my check from the IRS.

A. First of all, I must correct you in that we are not in a depression, as a matter of fact; technically we are not even in a recession. My understanding is that the government thinks we might go into a recession so they are sending checks.

Having said that, you most likely still will qualify for a refund of taxes even though you are not paying any taxes. The government is working on a method to solve your problem.


For recipients of Social Security and certain veterans’ benefits, and low-income workers who don’t normally need to file, the IRS has released a special version of a Form 1040A that highlights the simple, specific sections of the return that can be filled out by people like yourself to qualify for a stimulus payment.

“Most taxpayers just need to file a 2007 tax return in order to automatically receive the stimulus payment,” said Acting IRS Commissioner Linda Stiff. “But we are especially concerned about recipients of Social Security and veterans’ benefits who may need to take special steps this year to file a tax return in order to obtain a stimulus payment. IRS.gov will help taxpayers get what they need.”

There is a Frequently Asked Questions section – accessible through the front page of http://www.irs.gov/ -- includes an extensive set of information for all taxpayers with questions about the stimulus payments, commonly referred to as rebates. The questions and answers include important information for low-income workers and certain recipients of Social Security, Railroad Retirement benefits and veterans’ benefits.

The special IRS.gov section also features extensive examples of how much taxpayers can expect to receive in stimulus payments. The page includes more than two-dozen payment scenarios affecting different types of taxpayers.

The IRS will begin sending taxpayers their economic stimulus payments in early May, after the current tax season concludes. In most cases, the payment will equal the amount of tax liability on the tax return, with a maximum amount of $600 for individuals ($1,200 for married couples who file a joint return). Payments to more than 130 million households will continue over several weeks during the spring and summer. A payment schedule for taxpayers will be announced in the near future on www.IRS.gov.

AG TAX UPDATE

IF YOU HAVEN'T HEARD, THE FREE AG TAX UPDATE SCHEDULED FOR THURSDAY MARCH 20TH HAS BEEN CANCELLED. SORRY FOR THE INCONVIENCE.

BUSH SET DEADLINE FOR FARM BILL - ONE MONTH

(CQ Today) -- President Bush says he’ll ask Congress to pass a one-year extension of the farm bill if lawmakers cannot negotiate a new law by April 18. Bush said a one-year extension is not what he wants. But he said in a statement that “the government has a responsibility to provide America’s farmers and ranchers with a timely and predictable farm program — not multiple short-term extensions of current law. Last week, Congress enacted a 30-day extension of the current farm bill, and Bush signed that measure Friday. The president insists he will not sign a bill that includes new taxes. He has also pushed for significant restructuring of agricultural subsidies, a hard sell among lawmakers who represent big farming districts. A squabble brewing between the Senate Agriculture and Finance committees is complicating matters. The Finance panel is responsible for coming up with offsets to support the extra $10 billion in spending, but Agriculture Committee Chairman Tom Harkin, D-Iowa, says those efforts are infringing on his jurisdiction.

WILL COLLAPSE OF BEAR STEARNS HURT AG ECONOMY?

(Brownfield Network) -- “Obviously, there is tremendous volatility in the financial markets.” The words of John Blanchfield, Senior Vice President and Director of the American Bankers Association Center for Ag and Rural Banking. The question now is how will the collapse of Bear Stearns affect the agricultural economy in the United States? For one thing, it could very well prompt investors to pull back from financial markets and move their money into more secure investments like land. The financial difficulties on Wall Street do mean an even lower dollar and higher oil prices, but he thinks the ag economy is strong enough to withstand that. Blanchfield says one of the benefits to agriculture from the collapse of Bear Stearns is the Fed cut the interest rate again on Sunday night. “The one input that is going to be significantly lower in cost than last year is interest.” He adds the banks in mid-America have plenty of liquidity and are actively competing for sound ag business. He cautions we could see a general tightening of credit which could mean that "those who regulate the banks are going to demand that credit standards be upgraded and that verification and sound underwriting become very important.”

Tuesday, March 18, 2008

FARM PRICES AND ENERGY PROTECT MIDWEST FROM RECESSION

(AP) — Rising energy costs have been cited as one factor pushing the nation toward recession, but those same increases are keeping some state economies strong. Central states and those in the West with large stakes in oil, gas, minerals and corn — the main ingredient in ethanol — have avoided the economic downturn that threatens tax revenues elsewhere. Ernest Goss, a professor of economics at Creighton University in Nebraska, said there's no doubt that some states with energy reserves will maintain robust economies. Many Midwestern states expect to ride out the economic slump without severely cutting spending. South Dakota, Nebraska, Kansas and Iowa are insulated somewhat from serious impact because farmers are on a spending spree, Goss said. They expect the ethanol boom, which has driven corn and soybean prices to record highs, is here to stay. "This part of the country is weathering the recession much better and the reasons are the very good farm income, alternative energy production and finally the housing downturn has had not nearly the impact here." Tom Fullerton, an economics professor at the University of Texas at El Paso, said a weak dollar also could help drive demand for U.S. farm products. Fullerton recommended that states with large reserves consider spending more to repair roads and bridges, a move that would improve the infrastructure and boost the regional economy.

ARE NEBRASKA FARMERS DRIVING THE ECONOMY?

(Lincoln Journal Star) -- You can’t beat the recession with farm income alone. Agricultural production is responsible for 6% to 8% of the state’s income tax revenue, according to Mike Calvert, director of the Legislature’s Fiscal Office. Of course that is not the whole story. The percentage does not measure the economic benefits of ag-related industries, like ethanol plants or meat packers. And it doesn’t account for farmers spending during these times when crop prices are high, Calvert told senators during a budget presentation last week.

NPPP TO BUILD WIND FARM

(Omaha World-Herald) -- The Nebraska Public Power District said Monday that it would buy the electricity produced by wind generators planned near Bloomfield, Neb., opening the way for construction of the state's largest wind energy farm. The Columbus, Neb.-based utility signed a 20-year agreement to purchase power from Midwest Wind Energy LLC of Chicago and its affiliate, Elkhorn Ridge Wind LLC, which would generate 80 megawatts of electricity, enough to power about 25,000 Nebraska homes a year. NPPD operates a wind farm near Ainsworth, Neb., that can generate 60 megawatts of electricity. By contrast, NPPD's Gerald Gentleman Station coal plant near Sutherland, Neb., has a capacity of 1,300 megawatts.

Monday, March 17, 2008

AG CLASS CANCELLATION

Sorry, the Ag Tax Update scheduled for 3.20.08 has been cancelled. What were we thinking? When we scheduled we did not notice that this was Easter weekend. Because of this, we had several people that were not able to attend due to conflicts with church services.

WE ARE SAFE - CONGRESS IS IN RECESS

Both the U.S. House and Senate have adjourned for the two-week spring recess and will reconvene on Monday, March 31.

FOOD COST ARE UP - "IT'S ALL EHANOLS FAULT" SAY SOME EXPERTS; "NO IT'S NOT" SAY OTHER EXPERTS

(Grand Island Independent) -- As food and gas prices go up, a battle continues to rage between those who blame ethanol development for higher food costs and those who blame higher energy costs. A recent analysis by economist Tom Elam, Ph.D., president of Farm Econ. for the American Meat Institute, found that U.S. ethanol policy is continuing to drive meat and poultry prices higher. Elam said he expects food price inflation to rise 5-6% in 2009. He estimates the cumulative costs to the food industry of the federal renewable fuel requirement and tax incentives will be about $100 billion from 2005 to 2010. Elam said that as a result of the program, this year's swine input costs are up $2.9 billion; cattle input costs are up $2.24 billion; and dairy producer input costs are up $2.7 billion. But Terry Francl, senior economist American Farm Bureau Federation, said high crude oil prices are a contributor to today's high crop and food prices. "Too often, corn and ethanol demand are blamed for high food prices overall," said Ron Litterer, president of the National Corn Growers Association (NCGA). A recent study by the Federal Reserve Bank of Kansas City said that the marketing cost of food, along with rising labor and energy costs, are the key driver of food expenses. Francl said that among the major factors influencing the prices of key U.S. crops and the foods derived from them are investors' growing interest in commodity-focused funds, rising world demand, years of declining stocks of essential crops and the falling value of the U.S. dollar.

HAGEL: NEW FARM BILL MAY NOT PASS IN 2008

(Grand Island Independent) -- As Congress extended the 2002 Farm Bill through April 18, U.S. Sen. Chuck Hagel, R-Neb., said it's possible that a new Farm Bill won't be passed at all this year. "You could see this thing go through the whole year and wait for a new administration, new president and new Congress," Hagel said during a teleconference with state reporters Thursday. Hagel also said further extensions could be possible throughout the year as House and Senate conferees battle with the White House about proposed spending in the Farm Bill. "I would be quite surprised if you could get a Farm Bill passed and signed into law in the next 30 days," Hagel said.

BEGINNING FARMER ACT

(Neb. Farm Bureau release) -- Nebraska Farm Bureau is urging U.S. Sen. Ben Nelson to support S. 2637, the Beginning Farmers and Ranchers Act of 2008 introduced by Sen. Chuck Hagel. “Nebraska Farm Bureau believes this bill would create capital gains tax relief for farmers and ranchers who sell farm land and benefit beginning and expanding farm operations,” Farm Bureau President Keith Olsen said. It also will “zero out” capital gains taxes when agricultural land is sold to a beginning farmer or rancher and cuts the tax in half when farmland is sold to other agricultural producers. Today’s average farmer is 55-years old, Olsen noted. “As farms and ranches are sold in contemplation of retirement, selling prices reflect the cost of capital gains taxes. This makes farmland more expensive for beginning or expanding farmers and ranchers and can even push land out of agriculture when non-agriculture buyers are able to pay more.”

ETHANOL SALES IN NEBRASKA HIT RECORD HIGH

(Grand Island Independent) -- As the price of oil hit $110 per barrel and regular gas prices in Grand Island averaged $3.25 per gallon Thursday, ethanol was providing motorists some relief. With as much as a 7- to 10-cent-per-gallon difference between gasoline with 10% ethanol and regular unleaded, more Nebraskans are turning to ethanol to ease the higher cost of gasoline. According to the Nebraska Ethanol Board, ethanol sales in Nebraska hit a record high in December as 77% of gasoline sold contained ethanol. According to the latest short-term energy outlook from the U.S. Energy Information Administration, ethanol will reduce U.S. petroleum demand by 130,000 barrels per day in 2008.

Friday, March 14, 2008

TOP 100 BEST RURAL PLACES TO LIVE

'Magazine lists nine Nebraska counties among its Top 100 best rural places to live'

(Progressive Farmer Magazine) -- Progressive Farmer magazine has published its fourth annual "Best Places to Live in Rural America" report. The magazine's editors compiled the list of rural counties based on certain criteria, including home and land prices; crime rates; environment; education; economic factors; and access to health care. A review by the State Chamber of Commerce found nine Nebraska counties made the magazine's Top 100 list of Midwest counties. Red Willow County was listed as No. 10, Adams County was ranked as No. 12, and Wayne County was listed as No. 18. Also making the list were York County (No. 39); Cuming County (No. 45); Nemaha County (No. 55); Hamilton County (No. 65); Saline County (No. 71); and Madison County (No. 75). See Progressive Farmer's complete list of Top 100 Midwest Counties at
http://www.pfbestplaces.com/default.asp?pageAction=Display&Region=Midwest

Wednesday, March 12, 2008

WHEAT REPORT SETS OFF PRICE SURGE

(Lincoln Journal Star) -- Wheat prices on the Kansas City Board of Trade price closed Tuesday at $12.61 for a May futures contract. To say these are record prices for the hard red winter wheat raised in Nebraska seems to fall short of adequate description. A search of long-term records in Kansas City indicates that the highest futures price before the surge that started in late 2006 was $7.44 in April 1996. Royce Schaneman, based in Lincoln with the Nebraska Wheat Board, points to several factors in explaining this ascent into thin marketing air. More countries have more money to spend on grain imports. The weak U.S. dollar adds to the amount of wheat competing currencies will buy. Drought has hurt wheat production in Australia and other prominent wheat settings. And an emphasis on ethanol has crowded out some wheat acres and replaced them with corn. It’s mostly good news from Schaneman’s perspective, but he’s worrying about government rationing. “We don’t want to get into a situation where the U.S. government or somebody is going to step in and say we need to ration, or slow down exports, so we’ve got a domestic supply.”

SENATE PASSES 30 DAY FARM BILL EXTENSION (03.11.08)

(CQ Today) -- The Senate on Wednesday passed a 30-day extension of the nation’s farm law to give bicameral negotiators more time to hammer out a deal on a long-term agriculture policy overhaul. “We can’t leave here without doing a farm bill,” said Majority Leader Harry Reid, D-Nev. Minority Leader Mitch McConnell, R-Ky., agreed that the 30-day reprieve (S 2745) was needed. The House was expected to clear the extension later Wednesday. It would be the second stopgap measure since the last major farm bill was enacted in 2002. House-Senate negotiators have been working for months to reconcile competing versions of a new farm bill (HR 2419), and Reid said they were “making progress.” But their efforts have been slowed recently by the illness of House Ways and Means Chairman Charles B. Rangel, D-N.Y., who was hospitalized March 4 with flu-like symptoms and has not yet been discharged.

Saturday, March 8, 2008

AG TAX UPDATE

Don't Forget - Call Us Today!!

Attend the 19th Annual

Kopsa Otte FREE Ag Tax Update.

March 20, 2008

6:00-7:00 pm Horsdoeuvres

7:00-8:45 pm Class

Holiday Inn Hotel, York

For more information or to reserve a space,

please call 402.362.6636 or 800.975.4829,


Thursday, March 6, 2008

ON A PERSONAL NOTE

On a personal note, a couple of weeks ago I was honored to be asked by the State Chamber of Commerce to testify before the Nebraska State Legislature Revenue Committee supporting two proposed tax bills. This is the first time that I have been asked to testify, so it was very interesting to be involved with the process. Unfortunately, the committee has not yet taken action on the bills.

I serve as a board member of the Nebraska State Chamber of Commerce and chair the Small Business Committee.

IOWA BANK REGULATOR WORRIED OVER FARM LAND VALUES

(Reuters) -- Earlier this week, an Iowa banking regulator raised a warning flag about soaring agricultural land values, telling a congressional hearing that the U.S. farm land bubble could burst and unleash a fresh set of economic problems. "If there has been too much leveraged or loaned against the inflated value of farm land, the bubble will burst, and we will once again experience an economic crisis similar to that of the 1980s," Iowa Superintendent of Banking Thomas Gronstal told the Senate Banking Committee. Gronstal, who represented the Conference of State Bank Supervisors, was one of several regulators who testified about the subprime mortgage and credit problems that banks are facing. "In the future, should the price of corn, soybeans and other commodities decrease, the price of farm land would most likely also fall." The average value of U.S. crop land hit a record high of $2,700 per acre in 2007, compared with $1,340 per acre in 1998, according to USDA data. The value of crop land in some key Midwestern states was much higher, with Illinois averaging $4,460 per acre in 2007, the data showed. State banking regulators are preparing to handle a rising number of bank failures. "Based on current information and conditions, we do not expect widespread failures," Gronstal said.

Wednesday, March 5, 2008

NEBRASKA'S MOST VALUABLE CROPS

‘Crops add more than $9B to Nebraska's economy’

(Grand Island Independent) -- The value of Nebraska crops has grown by nearly $5 billion over the past two years, with corn leading the way as the result of the increase of the ethanol industry. According to a report released Thursday by USDA, the value of principal Nebraska agricultural crops last year totaled $9.2 billion, up from $6.1 billion in 2006 and $4.6 billion in 2005. Leading the way was corn, whose value was estimated at $5.9 billion last year, compared with $3.5 billion in 2006 and $2.4 billion in 2005. The average bushel price increased from $1.92 in 2005 to $4 last year. The second-leading crop was soybeans. Nebraska's third most valuable crop was hay. The fourth-leading crop was wheat.

Tuesday, March 4, 2008

ADMINISTRATION PROPOSES FARM SPENDING OFFSETS

(CQ Today) -- Farm-state lawmakers have not rejected the Bush administration’s latest funding proposal for the farm bill, but they say there is still plenty of work to be done. The ideas include recovering overpaid unemployment benefits, reducing reimbursements on equipment covered by Medicare and repealing research-and-development money for deepwater drilling. The proposal, which the department sent to Congress Feb. 29, stated that the White House would allow lawmakers to spend an extra $10 billion over 10 years in the farm bill (HR 2419) as long as the measure also included a significant overhaul of farm subsidies. The administration’s letter lists 13 spending cuts totaling about $22 billion; the idea is that lawmakers will choose the most politically feasible cuts on the list. President Bush has threatened to veto both the House and Senate versions of the bill, calling them too expensive and saying that they propose tax increases. The Bush administration says it still rejects a House provision that would end farm subsidies for any farmers who earn more than $1 million a year and make most of that money from farming. The White House wants that cap reduced to $500,000. The administration also is demanding that the bill end so-called planting restrictions. Current farm law prevents farmers who collect government subsidies, such as corn and soybean farmers, from also planting fruits and vegetables on their subsidized land. That mechanism keeps produce prices high, and fruit and vegetable growers have fought to keep the perk intact. The White House also is asking lawmakers to remove language in the House and Senate bills that would allow excess sugar to be used for ethanol, which could provide a boost in sugar prices.