October 2023 Policy Update

October 2023

By Lily Hawkins, Policy Director

Farm Bill Delays

On September 30th, the 2018 Farm Bill expired, and congress narrowly averted a government shutdown. Since-ousted Speaker of the House McCarthy compromised with Democrats to pass a last minute government funding patch, keeping the federal government open until November 17th. QUickly thereafter members of his own party adn democrats voted to remove him from the position of speaker. Efforts to elect his successor are expected to be messy, and distract from efforts to pass a new farm bill.

Expired Farm Bill Threatens Organic Certification Cost Share Program

The organic certification cost-share program is authorized every 5 years through the Farm Bill. 

After reductions in 2020, this spring, USDA’s Farm Service Agency (FSA) announced that they will be restoring reimbursement rates for the Organic Certification Cost Share Program (OCCSP) to 75% of the certified organic operation’s eligible expenses, up to a maximum of $750 per scope. This brings the amount of funding back up to the maximum allowed by the 2018 Farm Bill. 

Now that Congress has allowed the 2018 Farm Bill to expire, the cost share program is at risk. If a new Farm Bill is passed in the next few months with adequate funding for the cost share program, reimbursement will continue without disruption in 2024. But as a very small program cost-share does not have ‘permanent baseline’ funding status. This means that if the current Farm Bill is extended without a special provision, cost share will expire, leaving organic farmers who use the program with large increases to their certification expenses.

Take action: Please visit usa.gov to find contact information for your members of Congress and urge them to renew funding for the organic certification cost share program and modernize cost-share by supporting the Opportunities in Organic Act.

Congress introduces a Marker Bill to Support Organic Market Development

Last month, U.S. Senators Tammy Baldwin (D-WI) and Angus King (I-ME) and Representatives Chellie Pingree (D-ME-01) and Annie Kuster (D-NH-02) introduced the Organic Market Development Act to codify and increase support for the U.S. Department of Agriculture (USDA) Organic Market Development Grant Program, which aims to build and expand organic markets and address the need for additional market paths for organic farmers and producers through simplified grants for equipment and larger grants aimed at market development and processing capacity expansion.

The Organic Market Development Act aims to:

  • increase the capacity of the domestic organic product supply chain for producers, handlers, suppliers, and processors of certified organic products;
  • modernize manufacturing, tracking, storage, and information technology systems;
  • improve the capacity of eligible entities to comply with applicable regulatory requirements or quality standards required to access markets;
  • expand capacity for processing, aggregation, and distribution of certified organic products to create more and better markets for producers of certified organic products; facilitate market development for domestically produced certified organic products;
  • conduct feasibility studies and market viability assessments to inform organic transition strategies and opportunities;
  • address barriers to entry to organic product certification for historically underserved entities; and
  • support market and promotional activities that help build commercial markets for certified organic products in the United States.

You can view a one-page summary of the bill from Senator Baldwin’s office here, and full text of the legislation here.

USDA Expands Crop Insurance Options for Specialty and Organic Crops

Last week USDA announced new and improved crop insurance tools for organic and specialty crop growers. These changes have been announced on the heels of a two-year outreach and engagement effort from USDA’s Risk Management Agency. In addition to numerous changes for specific crops, organic growers will note the following updates:

New Insurance Options:

  • Transitional and Organic Grower Assistance Program (TOGA): For 2022, RMA offered this new program reduce a producer’s overall crop insurance premium bill allowing them to continue using organic agricultural systems. Premium benefits for TOGA included: 10 percentage points of premium subsidy for all crops in transition, $5 per acre premium benefit for certified organic grain and feed crops, and 10 percentage points of premium subsidy for all Whole-Farm Revenue Protection (WFRP) policies covering any number of crops in transition to organic or crops with the certified organic practice.
  • Tropical Storm Coverage: For crop year 2023 and succeeding years, RMA added a new option to Hurricane Insurance Protection – Wind Index (HIP-WI) for named tropical storm weather events. The Tropical Storm Option covers damage caused by strong weather systems not categorized as hurricanes. Both a wind and precipitation trigger must occur for an indemnity to be paid. This new option helped many producers recover after Hurricane Idalia this year. About 60% of eligible policies elected this option.

Improved Insurance Options:

  • Whole-Farm Revenue Protection Program (WFRP): Several improvements will begin in the 2024 policy year including: allowing all eligible producers to qualify for 80% and 85% coverage levels; allowing producers to purchase catastrophic coverage level policies for individual crops with WFRP; expanding yield history to a 10-year maximum (from four years) for all crops not covered by another federal crop insurance policy; making the policy more affordable for single commodity producers; and allowing producers to customize their coverage by choosing whether WFRP will consider other federal crop insurance policies as primary insurance when calculating premium and revenue to count during claim time.
  • Micro Farm: Several updates were made to Micro Farm including: moving the sales closing date to a less busy time of year to help agents dedicate time to marketing the program, allowing producers to purchase other federal crop insurance with Micro Farm, allowing vertically integrated entities to be eligible and making the Expanding Operations feature available.
  • Quality Loss Option (QLO): RMA is making the QLO available to several initial specialty crops, including avocados (California only), blueberries, cranberries, grapes, peaches, stone fruit, and table grapes. RMA plans to make the option available to additional specialty crops in the upcoming months after further review.

Read the full announcement from USDA here.

More Funding for Organic Dairy Farmers

On September 20, USDA announced a second round of payments for the Organic Dairy Marketing Assistance Program (ODMAP), which provides certified organic dairy producers with funding to help cover projected marketing costs in 2023.

The program originally covered 75% of estimated marketing costs at a rate of $0.825 per hundredweight, capped at the first 5 million pounds of estimated production. This second round of payments will cover the remaining 25% of estimated 2023 marketing costs, bringing payments up to $1.10 per hundredweight for eligible applicants.

The second ODMAP payment is automatic, producers who successfully applied for the first round of funding do not need to take further action.

This round of payments will bring total funds distributed through the program up to $20 million. The ODMAP program was allocated $104 million.

Since there is a significant lack of available data on the production and utilization of organic milk and in the absence of reliable independent data, USDA had to use the data from the conventional marketing of milk to calculate the producers’ cost of marketing milk for the ODMAP. Organic producers say that the cost of producing organic milk is significantly higher than that of conventional milk, and OFA will continue to advocate for more funding to reflect the difference. 

Take action: Please visit usa.gov to find contact information for your members of Congress and urge them to call on the USDA to provide another round of disbursements to reflect the higher cost of marketing for organic milk, and to support improved data collection and other support for organic dairy producers in the 2023 Farm Bill.