Crop Insurance Update: Bill Restoring Crop Insurance to Previous Levels Moves to President

Written by M. Sean High – Staff Attorney

On December 3, 2015, both houses of Congress voted to pass surface transportation legislation titled Fixing America’s Surface Transportation (FAST) Act (H.R. 22). Of importance to the agricultural industry, the legislation contained a provision that would repeal a $3 billion dollar cut to crop insurers included in the recently enacted Budget Act of 2015.

Under sec. 201 of the Budget Act of 2015, the overall rate of return for crop insurance providers was capped at 8.9% (a decrease from the previous overall rate of return capped at 14.5%).  Significantly, the 8.9% capped rate would have resulted in a cut to crop insures of $300 million annually and $3 billion over ten years.  Nevertheless, under sec. 32205 of FAST, sec. 201 of the Budget Act of 2015 is to be repealed and the overall rate of return for insurance providers capped rate is to be restored to the previous rate of 14.5%.

Prior to the December 3 votes, House Agricultural Committee Chairman Mike Conaway expressed his pleasure that through FAST, sec. 201 of the Budget Act of 2015 would be repealed. The Chairman stated that restoring the previous rates was necessary for “ensuring that crop insurance continues to be available, affordable, and accessible to America’s farmers and ranchers.”

Echoing Chairman Conaway, the Crop Insurance and Reinsurance Bureau (CIRB), American Association of Crop Insurers (AACI) and the National Crop Insurance Service (NCIS) issued a joint statement that declared:

The crop insurance industry fully supports efforts to return crop insurance to where it was before the budget bill was passed.  The budget bill contained a disastrous provision that would have devastated crop insurance as we know it today, harming U.S. farmers and taxpayers alike.

Crop insurance is a successful public-private partnership that has already sustained $12 billion in cuts since 2008. The likely result of additional cuts would be increased industry consolidation, reduced choice in insurance providers for all farmers, and a dramatic decline in the availability and service of policies.  Make no mistake - this cut would jeopardize effective private-sector delivery of crop insurance and take risk management for farmers in the wrong direction.

The final votes to approve FAST were 359-65 in the House of Representatives and 83-16 in the Senate.  As a result of the December 3 votes, FAST now moves to the President’s desk for final approval.

Big Data Big Questions Part 1

Written by Stephen Kenney

On October 28, 2015, the House Agriculture Committee held a public hearing to discuss the impacts of big data on agriculture.  The hearing focused on the opportunities and challenges of managing and utilizing big data to improve yield production.  Shannon Ferrell, associate professor and faculty teaching fellow at Oklahoma State University Department of Agricultural Economics, spoke on the legal issues concerning big data in agriculture.

Dr. Ferrell explained the possible legal framework that will be used to analyze agricultural data.  Data is most akin to intellectual property.  Intellectual property is made up of four different categories including: trademark, patent, copyright, and trade secret. Trademark is irrelevant to the data discussion on its face.  Trademark is defined in the United States code as “any word, name symbol, or device or combination thereof” used to identify a particular good or product.  Data is not a particular word, symbol, device, or combination of the three so it cannot be a trademark.

Dr. Ferrell went into more detailed analysis of patent, copyright, and trade secret law in relation to agricultural data.  He concluded that data could not be defined under patent laws because patent law protects “inventions.”  Raw data cannot satisfy the definition of invention which generally means that the invention must be capable of performing its intended purpose, be different from existing knowledge in the field, and non-obvious (“if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains”).

The analysis of copyright also concluded that agricultural data did not fall into this legal category.  Dr. Ferrell cited a Supreme Court case Fiest Publications Inc. v. Rural Telephone Service Company, where the Court held that the Copyright Act does not protect individual facts.  The author must add some type of creative component to ensure the intellectual property falls under the Copyright laws.  Agricultural data is just a collection of facts relevant to the agricultural process so it is not copyrightable in itself, but it could lead to copyrightable works.  A report that summarizes the data and includes recommendations for further action could possibly be copyrightable.

The final conclusion was the big data most likely falls under trade secret protections.  He came to this conclusion by focusing on the definition of “trade secret” under the Uniform Trade Secrets Act which all but three states have adopted.  Dr. Ferrell noted that the definition makes clear that “information….pattern(s), [and] compilation(s)” can be protected by trade secret law.  Data is inherently a compilation of information.

The data must also be proven to have economic value from not being known to other parties and be subject to reasonable efforts to maintain the secret.”  The argument for the data having economic value is that farm data such as “planting rates, harvest yields, or outlines of fields and machinery paths must have economic value because such information is not generally known.”  The owner of a trade secret is required to take reasonable steps to ensure that the information does not become generally known.  “Reasonable steps” almost certainly requires that there be “some form of agreement in place between the disclosing party and the receiving party regarding how the receiving party must treat the received information.”  Dr. Ferrell ultimately concluded that the trade secret option provides the “best doctrinal fit” among the traditional intellectual property forms.

Chairman Conaway Pleased with WOTUS Injunction

Written by Tyler R. Etter

On August 28, 2015, Rep. K. Michael Conaway (R-TX), Chairman of the House Agriculture Committee, released a statement regarding the recent preliminary injunction granted against the Environmental Protection Agency’s (EPA) implementation of the “Waters of the United States Rule” (WOTUS) in 13 states.

In his statement, Chairman Conaway called WOTUS a “disastrous rule”, and that he has expressed concern for the current administration’s “complete disregard for rural America.” He stated that WOTUS is a “gross overreach that punishes the very people it was intended to help.” He further stated that the House committee will continue to work to stop the implementation of the rule and to protect the rights of producers.

This is not the first time Chairman Conaway has commented on the rule. In May of 2015, he and Subcommittee Chairman Glenn Thompson (R-PA) of the Conservation and Forestry Subcommittee released a joint statement on the rule. They challenged the process of the creation of the rule claiming that it ignored American farmers and ranchers’ concerns. They also stated that the assurance of greater clarity was hollow comfort for those that would face steep fines for any violations.

The injunction was granted by North Dakota District Court Judge Ralph Erikson. The implementation of the rules is now halted in Alaska, Arizona, Arkansas, Colorado, Idaho, Missouri, Montana, Nebraska, New Mexico, Nevada, North Dakota, South Dakota, and Wyoming.

Proposed GMO Labeling Bill Will Not Preempt Cultivation Restrictions

  On July 17, 2015, Chairman of the House Agriculture Committee, Mike Conaway (R-TX) and Ranking Member Collin Peterson (D-MN) issued a statement on proposed house bill H.R. 1599, The Safe and Accurate Food Labeling Act of 2015.  According to the statement, H.R. 1599 only addresses the issue of GMO food labeling and does not go into other issues such as cultivation of GMO crops.  The statement indicated the goal of the proposed bill is to avoid a patchwork of state laws governing GMO food labeling.

  The statement was issued after a number of organizations expressed concern that the proposed bill would preempt state and county laws that have restricted or banned the planting of GMO crops.  According to a press release on the Center for Food Safety website, the organization believes H.R. 1599 “would not only prohibit all labeling of GE foods, but also to make it unlawful for states or local governments to restrict GE crops in any way.”

  The Environmental Working Group issued a news release with a similar interpretation, stating “The bill, H.R. 1599, would . . . stop state and local governments from regulating any process related to production of GMO crops.”  Other organizations, such as Just Label It campaign, have issued similar statements. 

Written by Katharine Richter - Research Assistant 

July 20, 2015

GMO Labeling Bill Passes House Agricultural Committee

  On July 14, 2015, the United States House of Representatives Committee on Agriculture approved Bill 1599, “The Safe and Accurate Food Labeling Act of 2015.” 

  H.R. 1599 was originally introduced by Representatives Mike Pompeo (R-KS) and G.K. Butterfield (D-NC) on March 25, 2015 and was referred to the House committee on Agriculture and the House Committee on Energy and Commerce.  According to a press release on the House Committee on Agriculture website, discussions between the two committees helped evolve the legislation.

  H.R. 1599 would create a national, uniform policy related to biotechnology labeling, preempting state labeling laws.  According to the press release, Chairman of the Agricultural Committee Michael Conaway (R-TX) commented, “The current patchwork system of varied labels interferes with the free flow of goods across the country, posing a real threat to interstate commerce and typically results in inconsistent and confusing information for consumers. Creating a uniform national policy regarding biotechnology labeling is the free market solution that will allow consumers access to meaningful information…”

Written by Katharine Richter - Research Assistant

July 14, 2015

Pompeo GMO Bill to be Reviewed by Committee on Agriculture

On July 14, 2015, H.R. 1599, the “Safe and Accurate Food Labeling Act”, will be reviewed by the House Committee on Agriculture. The review will mark the first action taken by a committee on the bill, and may signal the beginning of consideration in the full House of Representatives.

The bill seeks to create a voluntary federal certification for a product to be labeled as “non-GMO.” The bill would also preempt any individual state GMO labeling laws, an area of increasing focus as Vermont’s mandatory GMO labeling law’s 2016 deadline approaches.

The bill was first introduced by Representative Mike Pompeo, and currently has 68 sponsors, including 14 Democrats. Members of the National Corn Growers Association and the American Soybean Association will be lobbying to gather additional sponsors and support for the bill. The proponents of the bill wish to avoid a “hodgepodge of rules [that] would be unworkable for farmers” that could arise if a federal system isn't in place.

One opponent of the bill has stated that “[n]o one will be surprised if the House preempts state GMO labeling bills. The real battle has always been over the Senate.” There is a companion bill currently in the works by Senator John Hoeven, but there has yet to be a Democratic co-sponsor. 

Written by Tyler R. Etter- Research Assistant

July 13, 2015

USDA Deputy Administrator Discusses Voluntary GMO Labeling Program

  On June 25, 2015, The House Agricultural Subcommittee on Biotechnology, Horticulture, and Research held a public hearing reviewing USDA’s Agricultural Marketing Service (AMS) programs. 

 

  At the hearing, Deputy Administrator of Livestock Poultry and Seed Program for USDA’s Agricultural Marketing Service, Dr. Craig Morris, testified regarding AMS recently approving a process verified program that allows companies to voluntarily seek third-party verification to market their products as non-GMO that are 99.1% or above non-genetically engineered material.  According to the AMS program, if a company’s product is verified, they are permitted to sell that product using the USDA Process Verified Shield.

  Chairman of the Subcommittee on Biotechnology, Horticulture, and Research Rodney Davis (R-IL), remarked in his closing statements that USDA has “the capability and resources to provide valuable oversight of these voluntary marketing claims” and that the U.S. currently has “a robust regulatory review process to ensure human, plant and animals health, as well as environmental health.”

Written by Katharine Richter - Research Assistant

June 26, 2015

House Passes Three Agriculturally Related Bills

  On June 9, 2015, the United States House of Representatives passed by voice vote three agriculturally related bills: H.R. 2051 Mandatory Price Reporting Act, H.R. 2088 United States Grain Standards Reauthorization Act, and H.R. 2394 National Forest Foundation Reauthorization Act.  The bills were reauthorizations which the House Agriculture Committee Chairman, Michael Conaway (R-TX), wanted passed before the bills expired.  The bills still need to be presented and passed by the Senate.

  In a statement on Tuesday, Conaway commented, “As Chairman, my first goal was to have all reauthorizations taken care of before the deadlines passed, and that’s what we accomplished today. In fact, this completes our work in cleaning up the books of the House Agriculture Committee, addressing every item on the Congressional Budget Office’s (CBO) list of unauthorized appropriations under the Committee’s jurisdiction.”  He further stated the Acts are essential for farmers and ranchers to continue having necessary resources to carry out operations.

  House Bill, 2051 Mandatory Price Reporting Act, would reauthorize the Livestock Mandatory Price Reporting Act of 1999, which was set to expire on Sept. 30, 2015.  According to the House Committee on Agriculture website, the Act mandated “price reporting for live cattle, boxed beef, and live swine” as well as “allowed United States Department of Agriculture (USDA) to establish mandatory price reporting for lamb sales.”  The Act was originally created in response to changing markets and the lack of reporting sale prices as larger volumes of animals were being sold via marketing arrangements.  The price reporting mechanism that was previously voluntary became mandatory with the enactment of the 1999 legislation, the goal being to facilitate price transparency.  

  House Bill, 2088 United States Grain Standards Act, would reauthorize the United States Grain Standards Act of 1916.  According to the House Committee on Agriculture website, the Act gives “the federal government authorization to establish official marketing standards for grains and oilseeds and provided procedures for grain inspection and weighing.”

Written by Katharine Richter- Research Assistant

June 10, 2015

PA House Proposes Bill for the Mandatory Labeling of Genetically Engineered Foods

On October 17, 2013, the PA House referred a bill proposing mandatory labeling of foods that have been entirely or partially genetically engineered to the committee on Agriculture and Rural Affairs. The label would include the words, “Produced with Genetic Engineering.” If the bill (HB 1770) is reported out of the Ag and Rural Affairs committee, it will be considered by the entire House of Representatives.

For more information on GMO Labeling, please see the Penn State Agricultural Law Center’s Current Issues/GMO Labeling webpage.

For a list of states with genetically modified food labeling initiatives, see the Center for Food Safety website on State Labeling Initiatives. 

Written by Sarah L. Doyle - Research Assistant

The Agricultural Law Resource and Reference Center

@PSUAgLawCenter

October 21, 2013

U.S. House Names Conferees for House-Senate Conference Committee on the Farm Bill

On October 12, 2013, House Republicans and Democrats named the members who will serve on the House-Senate Conference Committee tasked with resolving the differences between House and Senate farm bills. Seventeen Republicans and twelve Democrats will serve as conferees. The House passed a motion to go to conference with the Senate on Friday, October 18.

For a list of Republicans serving as conferees, please visit the House Farm Bill webpage. For a list of Democrats serving as conferees, please visit the House Committee on Agriculture – Democrats webpage.

Written by Sarah L. Doyle - Research Assistant

The Agricultural Law Resource and Reference Center

@PSUAgLawCenter

October 14, 2013

Reid Requests Conference with Senate and House on Agriculture Bills

On October 1, Richard Cox reported on The Hill Blog that Senate Majority Leader Harry Reid (D-Nev.) requested a conference committee between representatives from the House and Senate to resolve their differences over the Farm Bill.

Reid named seven Democrats and five Republicans to the conference, all who serve on the Senate Committee on Agriculture, Nutrition, and Forestry.  The conferees are Senators Debbie Stabenow (D-Mich.), Patrick Leahy (D-Vt.), Tom Harkin (D-Iowa). Max Baucus (D-Mont.), Sherrod Brown (D-Ohio), Amy Klobuchar (D-Minn.), Michael Bennet (D-Colo.), Thad Cochran (R-Miss.), Saxby Chambliss (R-Ga.), Pat Roberts (R-Kan.), John Boozman  (R-Ark.), and John Hoeven (R-N.D.).  House conferees have not yet been decided upon; however, under congressional protocol, Frank Lucas, chairman of the House Agriculture Committee, would preside over the negotiations.

The existing Farm Bill expired on Tuesday, as lawmakers had not reached an agreement on a new bill.  The Senate passed a bipartisan farm bill earlier in the year which would reduce spending by $24 billion, mostly through restructuring farm subsidies into a crop insurance program.  The House passed a similar bill; however, it reduced food assistance by nearly $40 billion and separated food assistance programs from the agriculture policy.

Senate Agriculture Committee Chairwoman Stabenow’s statements on the conference can be found on the Agriculture Committee website.  Richard Cox’s original report can be found on The Hill Blog.  For more information on the Farm Bill, see the Farm Bill section of the Senate Agriculture Committee website and the House Agriculture Committee website, as well as our past blog posts from June 7,  June 11, June 20, and July 12.

Written by Alyssa Looney – Research Assistant

The Agricultural Law Resource and Reference Center

@PSUAgLawCenter

October 1, 2013